Don't call it a comeback: Cambria's latest ETF seeded in-kind raises ~$100 million
"Advisors are starting to understand the power of the 351 ETF Conversion."
Cambria Endowment Style ETF (ENDW) launched on Apr 9, 2025, with nearly $100 million in assets seeded in-kind via Section 351 conversion.
Here are the basics on Section 351 conversion, including my meme book all about it.
This outdoes the December 2024 launch of Cambria Tax Aware ETF (TAX), which seeded with ~$28 million in assets.
"Advisors are starting to understand the power of the 351 ETF Conversion”
I contacted Meb following the listing and asked what he thought drove the uptake.
“[Seeding an ETF in-kind] has obvious implications for highly appreciated [but diversified] concentrated positions, but also offers solutions for direct indexing, tax efficient rebalancing, and business development too.”
Cambria Endowment Style ETF (ENDW) has a complex mandate
“The Fund is actively managed and is designed to provide exposure to multiple major asset classes (e.g., equities, fixed income, and real assets and alternatives) in U.S., foreign developed, and emerging markets.”
Including:
Aggressive risk, using…
US ETFs, ETPs, or direct equity exposure, plus…
Futures
In my mind, this makes the sale tougher:
Leverage and complexity are tricky to explain
The ETF is designed to be a big chunk of an investor’s overall portfolio
However, investors may be noticing that the ETF wrapper is very tax-efficient, especially when it holds other ETFs that can be rebalanced in-kind.
As of Mon, Apr 21, I cannot see any futures in the portfolio.
The seed portfolio was mostly direct equities
Unlike a few recent ETF listings seeded in-kind (TAX, EBI), the incoming portfolio was mostly direct equities. Portfolio composition:
84% direct equity
16% other ETFs
The direct equity seed included some notable (but unsurprising) constituents:
15.24% NVIDIA Corp
5.97% Broadcom Inc
4.53% AutoZone Inc
4.09% Apple Inc
3.21% JPMORGAN CHASE & CO.
As of Apr 21, NVIDIA Corp and Broadcom Inc are less than 5% of the portfolio.
Thanks for reading.
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