Key Points:

• Hotchkis & Wiley has launched an ETF share class for its Mid-Cap Value Fund, giving investors an exchange-traded alternative to the existing mutual fund.
• The new ETF maintains the same investment strategy and portfolio management team as the mutual fund while adding intraday trading and the potential tax-efficiency characteristics associated with the ETF structure.
• The launch extends Hotchkis & Wiley’s expansion into ETFs following new offerings and ETF share classes introduced between 2025 and August 2026.

Hotchkis & Wiley Capital Management has expanded its ETF lineup with the launch of an ETF share class for its Mid-Cap Value Fund, giving investors another vehicle for accessing the firm’s actively managed value strategy. The move continues the Los Angeles-based asset manager’s broader transition into the ETF market and reflects growing demand for investment strategies that combine active management with the trading flexibility of an exchange-traded fund.

Company Background: Active Value Management at the Core

Founded in 1980, Hotchkis & Wiley manages actively managed equity and fixed-income portfolios for investors. The firm oversees approximately $42 billion in assets and has been expanding its ETF presence as it seeks to offer investors greater flexibility in accessing its established investment strategies.

The Mid-Cap Value strategy focuses on approximately 50 to 80 undervalued mid-sized companies. The investment approach targets businesses with sustainable cash flow and strong balance sheets that the firm believes may be temporarily out of favor or misunderstood, with the objective of generating long-term capital appreciation. The new ETF share class uses the same strategy and investment team as the existing mutual fund, rather than creating a separate portfolio management approach.

ETF Details: Mutual Fund Strategy Moves to Exchange Trading

The newly launched ETF share class provides investors with the ability to access the Mid-Cap Value strategy through an exchange-traded structure. Unlike a traditional mutual fund, an ETF trades throughout the trading day, potentially providing investors with greater flexibility in managing positions. The company also highlighted the potential tax-efficiency advantages of the ETF format.

The source material does not provide a ticker symbol, exchange listing, assets under management for the specific fund or an offering price. Those details should therefore not be treated as established terms. The launch is instead structured as an additional share class backed by the same portfolio and investment team as the existing Mid-Cap Value Fund.

Market Context and Expansion Opportunities

Hotchkis & Wiley’s ETF expansion comes as asset managers increasingly use the structure to broaden distribution for actively managed strategies. ETFs can provide intraday liquidity and access through brokerage platforms, while maintaining the portfolio-management framework associated with an established mutual fund strategy.

The firm has expanded its ETF ecosystem progressively. It launched its first standalone ETF, the Hotchkis & Wiley SMID-Cap Diversified Value ETF (HWSM), in 2025, followed by ETF share classes for the International Value Fund and Opportunities Fund in July 2026 and the Global Value Fund in August 2026. The Mid-Cap Value launch therefore forms part of a broader effort to make the firm’s active strategies available through multiple investment formats.

Risks and Challenges

The strategy remains exposed to the risks associated with mid-cap equities and value investing. Smaller and medium-sized companies can experience greater volatility than larger companies, while businesses considered undervalued can remain out of favor for extended periods. Market conditions can also affect the performance of value-oriented portfolios relative to other investment styles.

The ETF launch nevertheless expands the ways investors can access Hotchkis & Wiley’s established Mid-Cap Value strategy without changing its underlying investment approach. The significance of the new share class will depend on whether investors adopt the ETF format at scale and whether the strategy can maintain its appeal as market leadership rotates among investment styles and company sizes. For Hotchkis & Wiley, the launch marks another step in building an ETF platform around its active-management capabilities.