Behind the Ticker: Capturing Innovation Long-Term With FRWD

Innovation investing is a long-term focus for Nomura Asset Management, as demonstrated by the Nomura Transformational Technologies ETF (FRWD). Anthony Caruso, Head of Product Strategy & ETFs at Nomura, explained the fund's approach in an interview with Brad Roth on Behind the Ticker. FRWD, launched earlier this year, has already amassed over $275 million in assets under management.

The firm, with a century-long history in both Japan and the U.S., recently expanded into ETFs and currently manages around $1 billion in U.S. assets across nine funds. FRWD started as a separately managed account in 2018 before transitioning to an ETF in January. The strategy focuses on key long-term secular trends and narrows down to a concentrated portfolio of around 25 stocks, making up about 57% of the fund's holdings.

This concentrated approach has outperformed the Nasdaq-100 by approximately 200% since its inception in 2018. Caruso argues that thematic investing should be a core growth holding, not just a tactical satellite position, comparing it to building a lineup around Babe Ruth. With low turnover, a 65 basis point fee, and volatility viewed as an opportunity, FRWD has grown to about $260 million in just six months.

FRWD is part of Nomura's broader ETF push, which has crossed a billion dollars in total assets, including a successful emerging markets fund and a high-yield muni strategy. Nomura is positioning itself as a significant player in the U.S. thematic and active ETF space.