On Thursday, Goldman Sachs Asset Management announced the Goldman Sachs Future Tech Leaders Equity ETF (GTEK) launch. GTEK is a fully transparent, actively managed equity ETF that will generally invest in listed technology companies with market capitalizations of less than $100 billion across both developed and emerging markets. Goldman Sachs intends to invest in the fund alongside its clients.
“With almost a quarter of S&P 500 market capitalization in the top 1% of stocks, many investors are overexposed to mature US mega-cap technology companies,” said Katie Koch, co-head of the Fundamental Equity business within Goldman Sachs Asset Management. “We believe the dominant tech franchises in 10 years will be very different from the platforms we all know today. We are working diligently on behalf of our clients to try and identify future tech leaders with robust growth rates and the potential for outsized returns.”
Being at the forefront of technological innovation is critical to success in a digital world, where the pace of change continues to accelerate. “Most of the innovation we’ve seen in tech over the past few decades has been concentrated in the US and centered around a few companies,” said Sung Cho, portfolio manager of GTEK, “but we believe we’re at a key inflection point, with tech innovation expanding to other geographies and down the market capitalization spectrum.”
GTEK will seek to identify potential future tech leaders through active, bottom-up security selection with a disciplined approach to valuation. “GTEK will aim to provide exposure to our high conviction technology investment ideas globally, in a way that may complement investors’ existing portfolios,” said Brook Dane, portfolio manager of GTEK. “We see many exciting opportunities in areas including smart components, digital transformation, fintech, and cybersecurity. The current health pandemic has further accelerated the digitization trend, creating additional secular growth tailwinds, which we want to help investors get on the right side of to position their portfolios for the future.”
By investing in a fully transparent active ETF, investors may benefit further from being able to access these opportunities through an innovative wrapper. “By combining the expertise of our Fundamental Equity investors with the benefits of the ETF vehicle – including greater tax efficiency, transparency and trading flexibility than traditional mutual funds – we can provide our clients with compelling, tax-efficient investment solutions,” said Mike Crinieri, global head of ETFs within Goldman Sachs Asset Management.
The launch of GTEK expands the firm’s existing suite of thematic ETFs designed to help investors position their portfolios on the right side of disruption by providing focused exposure to long-term secular growth trends. Goldman Sachs Asset Management’s Fundamental Equity business manages over $20 billion in thematic equity strategies and has invested in dedicated technology equity strategies for over 20 years. GTEK, the GS Future Planet Equity ETF (GSFP), and the GS Innovate Equity ETF (GINN) make the firm’s thematic equity strategies accessible to U.S.-based investors in an innovative wrapper.
The fund is an actively managed ETF, which trades on an exchange like other publicly traded securities, and it will trade on NYSE Arca, Inc. under the ticker symbol "GTEK.” The fund is not an index fund and does not seek to replicate the performance of a specified index.
For more information, visit www.gsam.com/.
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