NEWS
ETF Express: A new ETF firm with a long history
Bancreek Capital Advisors is a relatively new addition to the ETF space, making its entry in 2023. To date, the firm, which has a quantitative, data-driven approach, has launched two ETFs. The first (BCUS), focusing on large-cap U.S. listed companies, made its debut in December last year. The second of the two (BCIL), featuring international large-cap businesses, came to the market in March.
At the launch of the firm’s second ETF, Andrew Skatoff, founder and chief executive of the firm explained the rationale for looking beyond domestic companies. He said that the firm wanted to turn its attention to the “many wonderful businesses outside the US”.
He added: “Unfortunately for investors, there is only a limited number of ETF options for the public to invest in a collection of these companies. With BCIL, we have deployed our proprietary framework and quantitative tools to make investing in structurally advantaged businesses outside the US more accessible for investors.”
Explaining the nature of the ‘structurally advantaged’ businesses that the firm’s models seek to identify, Skatoff says:
“The companies in the portfolios are businesses with a very specific area of expertise, that have developed an ‘edge’ – in some cases over a period of more than 100 years."
“They have developed a niche market, and then they have continued to compound their advantage over time. They are also businesses that have proven the ability to compound their cash flow consistently and almost as importantly, they have been able to continue with capital allocation in a consistent manner. They have grown, partly organically and many of them have acquired other companies as well.”
Reflecting on sectors, Skatoff says: “We’re heavily focused on industrials at the moment, at around 40 per cent exposure.”
Having just launched its first two products within the space of a few months, Bancreek is in no rush to follow these up with more just yet, as Skatoff explains: “For the time being, we’re focused on and excited about the two vehicles that we have in the ETF marketplace right now.”
One of Bancreek’s key features is an emphasis on the long term − and this doesn’t just relate to the age of businesses in its portfolio or its investment time horizon. The team relationships are long established too. Skatoff’s three colleagues are all friends that he’s known for more than 30 years – since childhood, in one case, when they were at the early stages of their shared interest in investment: “I met one of the firm’s partners in third grade when we played the ‘Stock Market Game’ together,” he explains:
Commenting on the long-term thread running through the business, he says:
“Our whole investment thesis is based on investing for long periods of time. And what better way to run a firm than with a group of people that you’ve known over a long period of time. It’s been the best experience of my life; I know we’re all working towards the same goal − and it’s also fun.”
Source: Nicolson, Fiona, 'A new ETF firm with a long history', ETF Express, 4/26/2024
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