Portfolio construction

Introducing GQI: Natixis Gateway Quality Income ETF

December 13, 2023 - 6 min read

Chief Executive Officer, Chief Investment Officer, and Portfolio Manager – Gateway Investment Advisers, LLC

MICHAEL BUCKIUS: Today, we're talking about our new ETF offering from Gateway Investment Advisors. It's the Natixis Gateway Quality Income ETF – ticker symbol GQI. It's a strategy that's built to have exposure to quality stocks and also support a robust monthly dividend.

We're excited to roll this out. We've been doing options-based investment strategies since the late '70s. We're sort of a pioneer in that space. And we think this strategy really builds on the DNA of our firm and really builds on our core competencies.

The fund itself consists of a core portfolio of stocks that emphasizes quality. Quality is a factor in the market that emphasizes companies that have strong balance sheets, high levels of cash flow generation, low levels of leverage. We're really excited about that particular factor. It's got a great history over the long term. And we think it's even more compelling in this high interest rate, high inflation environment.

We couple that equity approach with an options writing strategy that's designed to generate a robust level of cash flow to support that monthly dividend distribution. We apply that consistent systematic approach to a portion of the portfolio. So a critical feature of our strategy is a balance between high current levels of income through that dividend, but also continuing uncapped exposure to the long-term appreciation of the market over time.

So we're excited. It's an actively managed, fully transparent ETF with a 34 basis point net expense ratio. And we're happy to be here. You can learn more at im.natixis.com. Or you can search for GQI ETF on the web.

Bonds aren’t the only way to pursue investment income. The Natixis Gateway Quality Income ETF (GQI) is a high-quality equity fund that uses an option overlay strategy to deliver a robust monthly distribution.

Gateway Investment Advisers President, CEO and CIO Mike Buckius discusses the GQI strategy on the floor of the New York Stock Exchange. The core features of this actively managed, derivative income ETF are:

Quality – GQI holds a diversified portfolio of high-quality companies selected using a proprietary factor-based approach.
Income – GQI is designed to generate attractive monthly income from a combination of dividends and options premium.
Expertise – Gateway Investment Advisers has used index options in its attempt to generate cash flow and reduce risk since 1977.

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ETF General Risk:
Exchange-Traded Funds (ETFs) trade like stocks, are subject to investment risk, and will fluctuate in market value. Unlike mutual funds, ETF shares are not individually redeemable directly with the Fund, and are bought and sold on the secondary market at market price, which may be higher or lower than the ETF's net asset value (NAV). Transactions in shares of ETFs will result in brokerage commissions, which will reduce returns.

Risks:
Unlike typical exchange-traded funds, there are no indexes that the Fund attempts to track or replicate. Thus, the ability of the Fund to achieve its objectives will depend on the effectiveness of the portfolio manager. There is no assurance that the investment process will consistently lead to successful investing.

Investments in Equity-Linked Notes (ELNs) are subject to liquidity risk, which means there may not be an active market for ELNs which would prevent them from being sold at a fair price. Since ELNs are in note form, they are subject to certain debt securities risks, such as credit or counterparty risk. Should the prices of the underlying instruments move in an unexpected manner, the Fund may not achieve the anticipated benefits of an investment in an ELN, and may realize losses, which could be significant and could include the Fund's entire principal investment.

Options may be used for hedging purposes, but also entail risks related to liquidity, market conditions and credit that may increase volatility. The value of the fund's positions in options may fluctuate in response to changes in the value of the underlying asset. Selling call options may limit returns in a rising market.

Equity securities are volatile and can decline significantly in response to broad market and economic conditions.

The Fund is new with a limited operating history.

Before investing, consider the fund’s investment objectives, risks, charges, and expenses. Visit im.natixis.com or call 800-225-5478 for a prospectus or a summary prospectus containing this and other information. Read it carefully.

ALPS Distributors, Inc. is the distributor of the Natixis Gateway Quality Income ETF. Natixis Distribution, LLC is a marketing agent. ALPS Distributors, Inc. is not affiliated with Natixis Distribution, LLC.

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