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Behind the Ticker’s host Brad Roth, CIO of Thor Financial Technologies, chats this week with Chris Tessin, Managing Partner, CIO of Acuitas Investments. Tessin offers insights into the small- and micro-cap spectrum, opportunities specific to this year for small-caps, as well as why a multi-manager approach just makes sense in research-heavy assets.

Chris Tessin is a Founder, Managing Partner, and CIO of Acuitas Investments, a specialist investment firm focused exclusively on small- and micro-cap equities. The firm's flagship product has long been US micro-cap, but the scope covers global small- and micro-cap across institutional separate accounts — and most recently, a newly launched ETF, the Acuitas Small Cap Active ETF (AIMS).

The premise behind Acuitas was straightforward: investors — including large public pension plans — wanted access to the inefficient return opportunities deep in the cap spectrum, but didn't have the bandwidth to evaluate hundreds of small-cap managers on their own. Acuitas fills that gap by doing the manager research, pairing managers together in complementary combinations, and delivering the result in a single efficient structure. AIMS launched in February of this year and has accumulated over $80 million in assets.

The fund is multi-manager active small-cap ETF, which makes it genuinely different from the vast majority of active ETFs on the market. By aggregating multiple managers within one structure, Acuitas creates a scalable capacity profile while also balancing the active bets each individual manager is making. Additionally, manager sourcing is one of the most important and differentiated parts of what Acuitas does, from industry networks and referrals to tracking the ownership of individual securities to identify who is running compelling portfolios, and staying actively engaged with early-stage investment management firms. Acuitas has been a first investor in many small-cap and micro-cap products. By finding managers before they accumulate significant assets, Acuitas builds partnerships that benefit both sides and often secures access and economics that wouldn't be available later.

On the small-cap opportunity itself, Tessin makes a case rooted in both valuation and earnings expectations. Small-cap as an asset class has been largely left behind for more than a decade, with capital flooding into large-cap growth and endless headlines questioning whether small-cap is permanently dead. However, large-cap multiple expansion has driven a significant portion of the gains at the top of the market, and sensitivity to disappointment is high when valuations are stretched. Meanwhile, small-cap is trading at a substantial valuation discount to large-cap, and earnings expectations for the Russell 2000 in 2026 were running roughly 30% growth — double or triple the expected large cap earnings growth rate at the time of recording.

AIMS also proves a competitive small-cap offering via its fee structure. A traditional multi-manager fund-of-funds structure typically carries a two-layer fee problem — the manager charging at the fund level on top of the underlying managers' fees. AIMS charges a single all-in fee of 75 basis points. The client pays one fee that covers the manager research, ongoing oversight, daily monitoring, trading and implementation, and access to managers who in many cases have no publicly available product to begin with.

Acuitas Investments can be found at AcuitasInvestments.com. The firm encourages advisors, investors, and small-cap managers who want to connect or learn more about the product to reach out directly.

Disclaimer: The market insights, projections, and investment strategies expressed in this article are solely those of the contributor and do not necessarily reflect the views or opinions of ETF.com. This content is provided for informational purposes only and does not constitute financial, investment, or legal advice. 

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