Key Takeaways
- • Simplify Asset Management launched the Simplify Commodities Strategy No K-1 ETF (NYSE Arca: HARD) on March 28, 2023, positioning it as a core commodity holding and inflation hedge.
- • HARD is actively managed by Altis Partners, a commodity trading advisor with more than 20 years of experience, using two underlying models: price trend and fundamental reversion.
- • The fund is structured to avoid issuing a Schedule K-1 tax document, a differentiator Simplify highlights for investors and advisors.
- • HARD offers a long/short systematic approach intended to enhance a long-only commodity exposure, with a futures-based universe spanning energy, metals, and agricultural contracts.
- • HARD joins the Simplify Managed Futures Strategy ETF (CTA) in the firm's commodity-focused lineup.
Summary
Simplify Asset Management, a registered investment adviser founded in 2020, announced the launch of the Simplify Commodities Strategy No K-1 ETF (NYSE Arca: HARD), according to a Business Wire release. The fund is designed as a long-only commodity replacement that retains the enhancements of a systematic long/short managed futures strategy.
Simplify positions HARD as both a core commodity holding and an inflation hedging vehicle. David Berns, PhD, Simplify's Chief Investment Officer and Cofounder, said long-only commodity strategies have historically underperformed over long horizons, and that HARD is intended to provide commodity exposure for both short- and long-term allocations, with potential to perform during inflationary periods as well as in more typical market environments.
HARD is actively managed by the team at Altis Partners, a commodity trading advisor with more than 20 years of experience. The strategy combines two underlying models, price trend and fundamental reversion, which the firm says balance one another. Long/short forecasting models are used to optimize curve positioning for contango and backwardation. Futures contracts in the strategy include crude oil, RBOB, heating oil, natural gas, copper, gold, silver, corn, wheat, soybeans, and soybean oil.
The release notes that the fund will never deliver a Schedule K-1, which Simplify cites alongside enhanced core commodity exposure and inflation hedging as key attributes for investors and advisors. HARD joins the Simplify Managed Futures Strategy ETF (CTA) among the firm's commodity-focused offerings.
The release includes risk disclosures noting the fund is new with a limited operating history, that futures use carries leverage risk and potential losses exceeding principal, and that extended periods of contango or backwardation can cause significant losses. Past performance does not guarantee future results.
Simplify positions HARD as both a core commodity holding and an inflation hedging vehicle. David Berns, PhD, Simplify's Chief Investment Officer and Cofounder, said long-only commodity strategies have historically underperformed over long horizons, and that HARD is intended to provide commodity exposure for both short- and long-term allocations, with potential to perform during inflationary periods as well as in more typical market environments.
HARD is actively managed by the team at Altis Partners, a commodity trading advisor with more than 20 years of experience. The strategy combines two underlying models, price trend and fundamental reversion, which the firm says balance one another. Long/short forecasting models are used to optimize curve positioning for contango and backwardation. Futures contracts in the strategy include crude oil, RBOB, heating oil, natural gas, copper, gold, silver, corn, wheat, soybeans, and soybean oil.
The release notes that the fund will never deliver a Schedule K-1, which Simplify cites alongside enhanced core commodity exposure and inflation hedging as key attributes for investors and advisors. HARD joins the Simplify Managed Futures Strategy ETF (CTA) among the firm's commodity-focused offerings.
The release includes risk disclosures noting the fund is new with a limited operating history, that futures use carries leverage risk and potential losses exceeding principal, and that extended periods of contango or backwardation can cause significant losses. Past performance does not guarantee future results.
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