I have to admit it, I’ve got a soft spot for First Asset’s newest ETF: the DEX 1-5 year Laddered Government Strip Bond ETF (ain’t that a mouthful). To be honest, I haven’t slightest interest in it from a financial point of view, but I’m fascinated by how it came to be: a public, crowdsourced contest for dreaming up the company’s next ETF. Yes, crowdsourcing has come to the investment world.
It was a contest for Canadian advisors – submit 50 words pitching an idea for an ETF not yet available. @Justin_Bender won (he’s not the baby-faced advisor with the hair, is he? Oh wait, I’m thinking of Justin Bieber). $10k prize to a charity of the winner’s choice. $5k each – to charity – for second & third prizes. Nice. And pretty cheap to get advisors to express what they need (they could have gone further with an American Idol voting system). The First Asset PMs got the final say, after being ‘screened against viability criteria’ (with the costs of launching a fund, I’d have done a little market research, too… maybe they did).
So, was it gimmicky? Maybe a little. I wouldn’t want to be the second or third company to try it – that would be gimmicky.
More importantly, fund product development isn’t exactly done right most of the time anyhow. At least from a marketing point-of-view. The industry is generally behind the times (compared to automotive or other major consumer purchases) in building the marketing in to new products right at the drawing board. The crowdsource approach might be a bit far in the opposite direction, but it’s a welcome change.