Simplify Launches U.S. Equity ETF Powered by the Machine Learning Approach Pioneered by Wolfe Research

By: Simplify Asset Management via Business Wire

September 24, 2024 at 12:00 PM EDT

The Simplify Wolfe US Equity 150/50 ETF (WUSA) consists of long and short exposure to a range of U.S. equities, with a proprietary machine learning algorithm analyzing hundreds of fundamental factors to identify both long and short investment opportunities

Simplify Asset Management (“Simplify”), an innovative provider of Exchange Traded Funds (“ETFs”), is today adding to its lineup of compelling equity exposures with the launch of the Simplify Wolfe US Equity 150/50 ETF (WUSA).

The fund is designed to seek capital appreciation by taking a long position in approximately 250 stocks and a short position in approximately 150 stocks. Equity selection is driven by a proprietary multi-factor, machine learning stock selection model developed by Wolfe Research, WUSA’s subadvisor, and an industry-leading quantitative research firm.

“We’re very excited to be introducing WUSA in partnership with the team at Wolfe Research,” said Simplify’s CIO and Cofounder David Berns, Ph.d. “When it comes to machine learning-powered investment approaches, the model matters; and there is no firm more experienced or better qualified when it comes to the construction of sophisticated, differentiated models than Wolfe.”

The machine learning algorithm underpinning WUSA analyzes over 300 factors across thousands of data points to detect patterns that can help forecast securities prices. Unlike a quantitative model designed by humans, a machine learning model of this kind “learns” from historical data and develops its own model, free of human bias, through the identification of statistically significant patterns.

“As the algorithm ‘learns,’ it will identify those U.S. equities it has determined have the highest and lowest forward expected returns, respectively, and those stocks will in turn make up each basket of the WUSA portfolio,” added David. “Additionally, the fund’s 150/50 allocation structure widens the spectrum of returns, positive or negative, that WUSA can potentially harvest, making this a powerful new tool for investors and advisors looking for the opportunity to achieve capital appreciation from their equity exposures.”

WUSA joins a Simplify ETF lineup that has seen tremendous growth over the past year+, in terms of both new products and assets under management, with funds like the $1.3 billion Simplify MBS ETF (MTBA) and the Simplify Aggregate Bond ETF (AGGH) drawing attention for the income-producing capabilities, while the Simplify Volatility Premium ETF (SVOL), now at $1.2 billion in AUM, has become the largest fund in the firm’s equity suite.

“Today’s markets require new solutions, and with funds like WUSA, MTBA, AGGH, and SVOL, we are pleased to be providing the tools that can help address so many of the new challenges investors and advisors are facing,” added David.

For more information on WUSA, please visit https://www.simplify.us/etfs/wusa-simplify-wolfe-us-equity-15050-etf

The Simplify team also produces some of the investment industry’s most engaging and informative content, including deep dives into the various investment strategies, reactions to headline-making news and trends, and interviews with some of the most compelling names in research, trading and portfolio construction, which you can access here: https://www.simplify.us/news-media

ABOUT SIMPLIFY ASSET MANAGEMENT INC

Simplify Asset Management Inc. is a Registered Investment Adviser founded in 2020 to help advisors tackle the most pressing portfolio challenges with an innovative set of options-based strategies. By accounting for real-world investor needs and market behavior, along with the non-linear power of options, our strategies allow for the tailored portfolio outcomes for which clients are looking. For more information, visit www.simplify.us.

IMPORTANT INFORMATION:

Investors should carefully consider the investment objectives, risks, charges, and expenses of Exchange Traded Funds (ETFs) before investing. To obtain an ETF's prospectus or Summary prospectus containing this and other important information, please call (855) 772-8488, or visit SimplifyETFs.com. Please read the prospectus carefully before you invest.

An investment in the fund involves risk, including possible loss of principal.

The fund is actively-managed is subject to the risk that the strategy may not produce the intended results. The fund is new and has a limited operating history to evaluate.

The Fund invests in ETFs (Exchange-Traded Funds) and entails higher expenses than if invested into the underlying ETF directly. The lower the credit quality, the more volatile performance will be. When junk bonds sell off, the lowest-rated bonds are typically hit hardest known as blow up risk. Likewise, the riskiest bonds typically rise fastest in a bull market however these investments that don't have a credit rating are typically the most volatile, hard to price and the least liquid.

The use of derivative instruments involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments. These risks include (i) the risk that the counterparty to a derivative transaction may not fulfill its contractual obligations; (ii) risk of mispricing or improper valuation; and (iii) the risk that changes in the value of the derivative may not correlate perfectly with the underlying asset, rate, or index. Derivative prices are highly volatile and may fluctuate substantially during a short period of time. The use of leverage by the Fund, such as borrowing money to purchase securities or the use of options, will cause the Fund to incur additional expenses and magnify the Fund’s gains or losses. The Fund's investment in fixed income securities is subject to credit risk (the debtor may default) and prepayment risk (an obligation paid early) which could cause its share price and total return to be reduced. Typically, as interest rates rise the value of bond prices will decline and the fund could lose value.

While the option overlay is intended to improve the Fund’s performance, there is no guarantee that it will do so. Utilizing an option overlay strategy involves the risk that as the buyer of a put or call option, the Fund risks losing the entire premium invested in the option if the Fund does not exercise the option. Also, securities and options traded in over-the-counter markets may trade less frequently and in limited volumes and thus exhibit more volatility and liquidity risk.

Simplify ETFs are distributed by Foreside Financial Services, LLC. Foreside and Simplify are not related.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240924682521/en/

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MEDIA:

Chris Sullivan

Craft & Capital

chris@craftandcapital.com

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Simplify Launches U.S. Equity ETF Powered by the Machine Learning Approach Pioneered by Wolfe Research

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