“It remains to be seen. We hope to do well, and to do that, we’re attempting to design products that will function well with market making and liquidity considerations.”
Arnold says, “What we hope is that we can bring a different perspective, and our expertise, as a positive factor.”
PIMCO’s prominence and expertise as a bond manager could potentially set them apart in the long run. “Because we’re an active manager and trading in bond markets throughout the day, our insight into bond pricing and availability is strong. That puts PIMCO in a slightly different category,” Suskind notes.
The response from the industry and investors so far seems to have been positive, Arnold and Suskind note. It all boils down to having more choices, and delivering them in a convenient vehicle like ETFs. “For all the reasons people appreciate ETFs, they appreciate having the expertise in fixed income management,” says Suskind.
In addition to the filing for six funds, exemptive relief for actively managed ETFs based on currencies, commodities, equities and asset allocation has also been filed.
The ETFs will include the following:
- an ETF that will track the 3-7 Year U.S. Treasury Indexes
- an ETF that will track the 7-15 Year U.S. Treasury Indexes
- an ETF that will track the 15+ Year U.S. Treasury market
- a Broad U.S. TIPS Index
- a Short Maturity U.S. TIPS Index
- a Long Maturity U.S. TIPS Index
Kevin Grewal contributed to this article.