‘New Breed’ Income ETFs for a Low-Yield Market | ETF Trends

“Multi-asset” funds designed to deliver income and stability such as SPDR SSgA Income Allocation ETF (NYSEArca: INKM) are an important developing trend in the ETF business.

“Such ETFs are a new breed. In the past, ETF developers favored increasingly narrow slices of the securities markets.” Bloomberg News reports. “The State Street ETF turns that model on its head. It is one of a handful of so-called multi-asset income ETFs that offer a one-size-fits-all solution for income-hungry investors.”

Multi-assets ETFs are still small in number and have not attracted much investor attention, says Morningstar analyst Patricia Oey. [Multi-Asset ETFs For Yield and Stability]

“These ETFs, as one-stop funds for diversified income exposure, seek to address investors’ need for higher and potentially more stable income,” she wrote in a recent report.

The funds “invest across a number of ‘income’ asset classes, such as U.S. and foreign dividend-paying equities, REITs, Master Limited Partnerships, high-yield bonds, and emerging-markets debt,” Oey explains.