Actively managed exchange traded funds are finally getting some attention, as successful new products have recently launched. The fixed income category of active management has been able to acquire assets, setting momentum for this area of the market.
“Although we estimate that actively managed ETFs represent roughly 5% of all the assets in U.S.-traded ETFs, we see interest on the rise, as evidenced by the number of such ETFs being offered and launches by various fund managers. We think that both existing fund companies and new entrants will increasingly be looking at actively managed ETFs to both defend market share, and to attract new money,” Tom Graves, S&P Capital IQ Analyst wrote in a recent MarketScope report.
Pimco Global Advantage Inflation-Linked Bond Strategy Fund (NYSEArca: ILB), with $13 million in assets, is Pimco’s 6th active ETF launch and now brings the total of actively managed ETFs to 47. At the end of April, the active management space had about $$5.8 billion in assets with about 90% of this allocated to fixed income or currency focused products. [Actively Managed ETFs: The Next Frontier?]
In contrast, at the end of March, there was about $1.19 trillion invested in the U.S. ETF industry with 71% of these assets allocated to equities. [ETF Focus: Pimco Total Return]
The actively managed ETF space has appealed to the fixed income and currency-focused investors, while actively managed equity ETFs have not appealed to many. There are about 11 equity focused actively managed ETFs currently, with around $110 million in assets under management.