Over 160 exchange traded funds have come to market this year. Few have had the success at the asset-gathering level that the WBI Tactical Income Shares (NYSEArca: WBII).
The WBI Tactical Income Shares debuted in August as part of a suite of 10 actively managed ETFs from WBI Investments, a New Jersey-based asset manager and issuer of several mutual funds. WBI has rightfully garnered acclaim as the firm’s 10 ETFs rapidly cobbled together a combined $1 billion in assets under management. [WBI Enters ETF Fray With 10 Funds]
“With over 11,000 accounts, WBI has more than $2.4 billion in assets under management across all of its product lines (as of December 2013),” the firm says on its web site.
WBII has been a primary driver behind the firm’s swift ETF success. With nearly $149 million in assets under management in just two months of trading, WBII’s AUM total has been topped by just five other ETFs that have also debuted this year. WBII is locked in a tight race with a stablemate, the WBI Tactical High Income Shares (NYSEArca: WBIH) for the title of largest WBI ETF. [Another Good Year for New ETFs]
The new ETF has also benefited from being at the right place at the right time, coming to market amid a surge in volatility that sent investors flocking to low volatility strategies. WBII provides “provides low volatility, low correlation and an optimal blend of bear market capital preservation and bull market return,” according to WBI Shares.
Since coming to market, WBII has soundly topped the S&P 500, due in large part to the ETF’s almost 58% weight to short-term Treasuries. That trait further buoys WBII’s “right place, right time” status because low duration Treasuries have been a favored asset class this year as investors anticipate a 2015 rate hike from the Federal Reserve. [A Simple Short-Term Bond ETF]
“WBI’s proprietary bond model strives to reduce interest rate risk on core bond holdings in an effort to protect invested capital. The goal is to actively shorten duration to minimize loss as interest rates rise, or to lengthen duration to increase yield and potential for capital gain as interest rates decline,” according to the issuer.
The fund also employs an ETF of ETFs to some of its other holdings, which include four Guggenheim BulletShares defined maturity ETFs as well as the PIMCO Total Return ETF (NYSEArca: BOND) and theVanguard Total Bond Market ETF (NYSEArca: BND).
WBI Tactical Income Shares Holdings
Table Courtesy: WBII Investments