Strive is ramping up ETFs as co-founder Vivek Ramaswamy steps away to run for U.S. president

Strive Asset Management has “big ambitions” for this year, as it continues to ramp up its lineup of exchange-traded funds, according to the firm’s co-founder and president Anson Frericks.

“By the end of the year we would anticipate probably having somewhere around 15” ETFs, compared with eight currently, Frericks said in a phone interview. “It’s been a good ramp so far.”

Strive, whose co-founder Vivek Ramaswamy is seeking the Republican nomination for U.S. president, offered its first ETF in August and now has around $700 million of assets under management across its funds, according to Frericks. He said Ramaswamy has “stepped away” from the Strive’s board and day–to-day responsibilities so that “Strive can remain committed to our mission of depoliticizing corporate America.”

When the firm announced the launch of its flagship index fund Strive U.S. Energy ETF, Strive said at the time that companies should produce more oil and gas, “while abandoning ESG-imposed constraints on the sector,” to capture the “immense economic opportunity to meet global energy demands.” ESG is an abbreviation for environmental, social and governance criteria.

The Strive U.S. Energy ETF
DRLL,
+0.76%,
Strive 500 ETF
STRV,
+1.48%
and Strive Emerging Markets Ex-China ETF
STXE,
+0.14%
are the firm’s most popular exchange-traded funds in terms of assets under management, according to Frericks. 

The firm plans to launch an international ETF focused on developed markets excluding the U.S. at the end of this month, he said. So far, all of the firm’s ETFs are passively managed. 

But Strive is planning to launch active ETFs in fixed income, according to Frericks.

Matt Cole, who last year joined Strive from the California Public Employees’ Retirement System, will be using his expertise as a bond portfolio manager at Calpers “to launch our first actively traded funds,” said Frericks. Within fixed income, Strive is planning to launch in the first half of this year a total return fund, a short-term fund and possibly a “Treasury product,” he said.

Beyond fixed income, Frericks said that “in the second half of the year, we’ll probably lean into a couple more sector specific funds.”

Ramaswamy and Strive have developed a reputation as being “anti-ESG” and “anti-woke,” labels that Frericks steered away from for the firm. “We’re not an anti-woke company,” he said. “You don’t see us saying ‘we’re anti-ESG.’”

But large asset managers and companies shouldn’t use their “bully pulpit” to try to effectuate change on environmental and social issues, he said. “We just want companies to focus on providing excellent products and services.” 

Strive – whose lineup of domestic equity ETFs also include funds focused on the U.S. semiconductor industry, small-cap companies
STXK,
+2.02%
and investment styles such as value
STXV,
+1.15%,
growth
STXG,
+1.74%
and dividend growth
STXD,
+1.36%
— differentiates itself in “how we do corporate governance,” said Frericks.

Like other asset managers, Strive engages in proxy voting and shareholder engagement. But “we are a firm for everyday citizens that just want companies to focus on excellence, not necessarily getting involved in the latest and greatest social or political issue,” he said. 

Strive has sent letters to companies including Exxon Mobil Corp.
XOM,
+0.16%,
Chevron Corp.
CVX,
+0.47%,
Apple Inc.
AAPL,
+1.56%
and Walt Disney Co.
DIS,
+2.07%,
according to the asset manager’s website.

And at the end of February, Strive tweeted that it wrote a letter to the board of Salesforce Inc.
CRM,
+1.62%
“to deliver a simple message: steer clear of broader, politically charged, value-destroying social activism and focus exclusively on maximizing shareholder value by delivering excellent products to customers.”

Read: Salesforce stock soars as Benioff says goal is to be the ‘most profitable software company in the world’

According to a Barron’s report in early March, Salesforce chief executive officer Marc Benioff pointed to activist investor ValueAct Capital CEO Mason Morfit as helping to boost earnings. But Benioff told Barron’s that Ramaswamy, presidential hopeful and author of Woke Inc., is “not truly an activist investor.” Benioff said “he’s just a politician.”

According to FactSet data, Strive’s best-performing ETF by far this year is the Strive U.S. Semiconductor ETF
SHOC,
+0.67%.
The fund, which tracks an index of semiconductor companies in the U.S. equity market, has year-to-date gains of around 18% based on Thursday afternoon trading. By contrast, shares of the Strive U.S. Energy ETF are down 3.7% so far this year, FactSet data show, at last check.

As usual, here’s your look at the top- and bottom-performing ETFs over the past week through Wednesday, according to FactSet data.

The good…

…and the bad

New ETFs

• Vanguard announced Thursday that it launched the Vanguard Short-Term Tax-Exempt Bond ETF
  VTES,
  +0.09%,
  a municipal bond index ETF “designed for tax-sensitive investors with a short-term time horizon and low interest rate risk tolerance.”

• F/m Investments said March 7 that it launched the US Treasury 6 Month Bill ETF
  XBIL,
  +0.03%.
  “Investors want an easy, tax-efficient way to obtain yields that have not been seen in a low-risk, liquid investment in a very long time,” Alexander Morris, F/m’s president and chief investment officer, said in the announcement, pointing to yields of more than 5% for six-month Treasurys.

Weekly ETF reads