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Blogger-turned-ETF manager hits back at negative press with a little help from Twitter friends

  • Eddie Elfenbein is portfolio manager of AdvisorShares Focused Equity ETF (CWS).
  • Barron's published a negative story this weekend about the fund.
  • Many supporters of Elfenbein and the fund tweeted their criticism of the story.
Eddy Elfenbein
Giovanny Moreano | CNBC
Eddy Elfenbein

An unflattering profile piece this weekend in Barron's has generated some online discussion, and the portfolio manager himself published a response.

"I just felt the whole thing was kind of bizarre," Eddy Elfenbein, portfolio manager of the AdvisorShares Focused Equity ETF (CWS), told CNBC in a phone interview Tuesday.

"People over the weekend, they felt insulted when the profile came out," he said. "Since I put the response out my inbox and twitter feed is just getting flooded with hugely positive comments."

The article in the well-respected financial magazine said CWS has "noble sentiments" but criticized the fund's high fees by comparing it to an index fund and mutual funds.

"We stand by our story," Colleen Schwartz, spokesperson for Barron's owner Dow Jones, said in an emailed statement to CNBC.

Elbenfein only launched CWS in September, based on his Crossing Wall Street blog's "Buy List" strategy of holding 25 stocks for a year, with five switched out at the end of the year. The strategy has beat the S&P 500 eight times in the last decade.

CWS now has $12.2 million in assets under management, and Elbenfein only gets paid an additional performance-based fee if the fund beats the S&P 500.

Barron's "criticize(d) our active ETF for not charging the ultra-low fees of an index fund. This is a bizarre point," Elfenbein said in a response published Monday on AdvisorShares' website.

"The vast majority of active managers haven't beaten the market. We have. Compared with other active managers, our fees are quite competitive. Naturally, if we continue to beat the market by a decent margin, then a fee comparison with index funds is moot," he added.

The fund traded slightly lower Tuesday, up nearly 11 percent for the year, versus the S&P's 9.8 percent gain.

Josh Brown, CEO of Ritholtz Wealth Management and a CNBC contributor, tweeted Sunday that he owns CWS and that the article was "needlessly hostile to a great idea and a wonderful guy."

Another widely-followed, but unnamed, analyst on Twitter called NoonSixCap tweeted that the Barron's piece "just struck me as overly personal."

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