According to Robert Huebscher for Advisor Perspectives, active managers won’t be able to outperform the passive TIPs ETF in net fees, and in an attempt to outperform passive funds, active managers will also be more inclined to take excessive risks. Huebscher also notes that PIMCO may be more biased toward active management since a major chunk of the company’s revenue comes from actively managed bond portfolios.
- SPDR Barclays Capital TIPS (IPE): up 6.3% year-to-date
- iShares Lehman TIPS Bond (TIP): up 5% year-to-date
For more information on Treasury inflation protected securities, visit our TIPs category.
Max Chen contributed to this article.