Episode summary
Managing Risk, Capturing Growth: ETF Strategies from WEBs and Alger
ETF Prime
· · 58 min · Hosts: Nate Geraci, Simeon Hyman · Guests: Ben Fulton, Arthur Nowak
Summary
Webs Investments’ Ben Fulton argued that investors do not have to choose between risk management and equity upside. His defined-volatility ETFs, including the new sector lineup, adjust exposure daily by comparing recent realized volatility with each underlying market’s long-term norm. When volatility is low, exposure can increase; when it rises, exposure can be cut, with the sector products designed to move more aggressively than the firm’s broad-market funds.
Fulton said the appeal is strongest for investors who already want sector exposure but want a rules-based way to lean into favorable regimes and back away from stress. He framed the products as a tax-efficient ETF wrapper for a volatility-sensitive process that historically had been available mainly to institutions. He also acknowledged the main weakness: fast-moving markets and grinding down markets can create tracking error or leave the fund underexposed when prices reverse quickly.
Arthur Noak of Alger said the firm is built around growth investing, with a heavy emphasis on bottom-up research and “positive dynamic change.” He highlighted ALAI, which invests across AI enablers and adopters, and CNEQ, a 30-stock concentrated growth ETF. Noak also said Alger’s index-based INVN ETF tries to capture innovation with a rules-based screen that favors higher R&D and stronger free cash flow, reflecting a more prudently priced approach to growth.
Key takeaways
- Fulton said Webs’ defined-volatility ETFs can scale sector exposure from zero to 2x based on daily volatility readings versus a long-term benchmark.
- Fulton argued the sector products are designed for high-conviction investors who want to stay exposed to the theme but reduce risk when volatility spikes.
- Noak said Alger’s AI ETF, ALAI, combines AI infrastructure builders with AI adopters and is meant to be a core growth holding or a satellite position.
- Noak said Alger’s CNEQ concentrates in 30 or fewer growth names to let the firm express its highest-conviction ideas with larger position sizes.
- Noak said INVN screens out low-free-cash-flow companies and then ranks the rest by R&D intensity, aiming for “high innovation prudently priced.”
Notable quotes
“when volatility in the markets are low markets tend to outperform compared to when volatility is high they tend to underperform”
“our target, we're at about 120% of historic volatility levels”
How the episode opens
I mean earlier this year, I mean, we went into very unpredictable volatility. No one knew. Every day we were like, "Okay, is there going to be new tariffs dropped on a firm?
Are they going to be lifted? And the markets are going up and down. All right.
Joining me will be Ben Folton, CEO of Webs Investments, who is building out an interesting lineup of what they call defined volatility ETFs. So, there are currently 13 ETFs in all, two of which are broad-based ETFs where the underlying exposure is the S&P 500 and the NASDAQ 100. And then in July, they rolled out a suite of sectorbased products where the underlying exposure is actually select sector spider ETFs.
And we'll obviously get into this, but the bottom line is Ben believes investors shouldn't have to choose between managing risk and pursuing growth. He actually says you can have your cake and eat it too. And you can do that with these defined volatility strategies.
So we'll go in depth on how these work and how to think about them in the context of a broader portfolio. And I should note Ben is a longtime industry veteran. This is someone who helped grow Powershares into a leading ETF issuer starting back in 2005.
He was a founding partner of Claymore Securities back in the day, which I think that place has more illustrious ETF alumni than just about anyone, but I could go on with uh Ben's resume. He is a true ETF pioneer and he will join me here in just a minute. Now later I'll be joined by Arthur Noak, client portfolio manager at Alger who's also an interesting ETF issuer.
Uh the firm itself has been around since the 1960s. They managed some $30 billion in assets and I would say they really hang their hat on fundamental research and investing in change.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- defined volatility etfs
- real-time volatility risk management
- equity exposure adjustment
- innovation and growth investing
- alger ai themed etf
Companies and tickers mentioned
- WEBs Investments
- Alger
Watch the episode
Watch “Managing Risk, Capturing Growth: ETF Strategies from WEBs and Alger” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
More from ETF Prime
-
Inside the Latest iShares ETF Trends with BlackRock’s Jay Jacobs -
Anthropic IPO & Bitcoin DRIP ETFs -
Baird Strategas’ Todd Sohn on ETFs: What’s New and What’s Next -
The AI Trade: Opportunity, Risk & What Comes Next -
SEC’s Brian Daly Provides an Update on Novel ETFs -
The ETF Stories to Watch for the Rest of 2026
ETF Prime, this episode and its artwork belong to Nate Geraci. Octagon is not affiliated with the show; this page is an independent summary.
