The Davis Way: High-Conviction, Benchmark Agnostic, Fully Transparent, Active ETFs

Let's Talk ETFs

After years as an index fund evangelist at top ETF firms like BlackRock and SSgA, Dodd Kittsley did a 180 of sorts, becoming Director of active manager Davis Advisors. Still opposed to the “closet indexing” that marks many active managers, Dodd was drawn to Davis’ unique approach to active management: High-conviction, low turnover, low cost, tax-efficient and fully transparent. He joins the first Let's Talk ETFs of 2021 to go under the hood of Davis’ four ETFs, which now have more than $1B in AUM between them: DWLD, DUSA, DINT and DFNL, and discuss why his firm is currently overweight the Financials sector.
Show Notes
· 3:00 - How did Dodd end up in the ETF space and why did he choose join a small firm after so many years at behemoths like BlackRock and State Street?
· 9:00 - What is Davis's approach and what makes it unique? What's the research process like?
· 14:15 – Other active managers cite things like front-running and protection of intellectual property as major concerns. Why is this not the case for Davis?
· 22:15 - Do you have plans to go the semi-transparent active management route in the future?
· 25:15 – Going under the hood of Davis’ four ETFs:
The $330M Davis Select Worldwide ETF (DWLD)
The $310M Davis Select U.S. Equity ETF (DUSA)
The $270M Davis Select International ETF (DINT)
The $150M Davis Select Financial ETF (DFNL)
· 28:00 - Is Davis’ approach entirely a “bottom up” one?
· 30:15 - How much turnover is there? How do the funds look from a tax perspective?
· 38:45 – DFNL and the case for Financials: Given the current historically low rate environment and flat yield curve, why is Davis currently overweight Financials?
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