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A Conversation With Global X's Director Of Research, Jay Jacobs

Summary

Global X oversees almost 50 ETFs and over $3 trillion in assets.

The company is best known for its SuperDividend family of funds.

We talk about oil prices, opportunities in the high yield market and how the rest of 2016 could play out.

We also discuss Global X's approach to smart beta.

JPMorgan recently acquired a minority stake in Global X.

During the past month, I had the opportunity to speak with Jay Jacobs. He's the Director of Research at Global X, the New York-based ETF sponsor that oversees nearly 50 different ETFs and manages over $3 trillion in assets.

While the company may be best known for its SuperDividend ETF (NYSEARCA:SDIV) and SuperDividend U.S. ETF (NYSEARCA:DIV) and the combined $1 trillion in assets between them, Global X offers funds that provide investment exposure to areas such as energy, MLPs, social media, gold, silver, uranium, copper, Greece, China and Japan. More recently, Global X has joined in on the smart beta trend and now offers a total of four smart beta (or scientific beta) funds.

In our conversation, we discuss the high yield market, smart beta funds, oil prices and themes to keep an eye on throughout the rest of the year. My personal thanks goes out to Jay for taking some time out of his busy schedule to offer up his thoughts.

Note: Since our discussion, it was announced that JPMorgan (NYSE:JPM) bought a minority stake in Global X in order to expand its presence in the ETF space. While we don't discuss it here, it was noted that the relationship is a strategic partnership as opposed to a buyout and that "Global X is still Global X".

(Dierking): To start out with, can you tell me a little bit about your role overseeing investment research at Global X?

(J. Jacobs): The research team at Global X focuses on three key areas: Education, Insights, and Portfolios. "Education" refers to how we communicate with our clients and seek to explain the behavior of a particular asset class, or how a particular strategy works. "Insights" is inclusive of our aim to examine and provide ongoing information on market trends. This is done, in part, by developing reports and opinion pieces. Lastly, we provide assistance with portfolio construction to help clients understand how a particular fund or strategy can fit within their portfolio or can be used to potentially achieve specific goals.

(Dierking): The Global X SuperDividend ETF and the SuperDividend U.S. ETF are your two biggest funds accounting for over $1B in assets between them. What areas of the market are you finding attractive right now for high yielding stocks?

(J. Jacobs): We find that high yielding stocks are broadly attractive for a few reasons. First, when we brought the SuperDividend ETF to market in 2011, we were seeking to help investors maximize the income they could generate from equities in an environment where traditional fixed income was not providing high enough yields for many investors. As 10 year treasuries are still yielding below 2% in...


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