TOTL combines traditional fixed income investment sectors of the Barclays US Aggregate Bond Index and fixed income asset classes outside the index with the goal of maximizing total return over a full market cycle through active sector allocation and security selection. DoubleLine will strive to maintain TOTL’s portfolio investments with a shorter duration than that of the Barclays US Aggregate Bond Index. Duration is a measure of the sensitivity of the price of a fixed income investment to a change in interest rates expressed as a number of years, according to a statement issued by State Street Global Advisors.
“DoubleLine is pleased to partner with SSGA, the pioneer of exchange traded funds,” said Gundlach in the statement. “DoubleLine was founded on the idea of striving to deliver better risk-adjusted returns across our different investment strategies. In TOTL, we will strive to maintain the fund’s portfolio investments with a shorter duration than the Barclays US Aggregate Bond Index while seeking to generate a healthy yield. That combination is key to meeting the fund’s total return objective within a discipline of strong risk management.”
Los Angeles-based Double Line currently offers mutual funds including bond funds focusing on low duration bonds. The firm also offers multi-asset strategies as well as a mutual fund focusing on small-cap stocks. The firm reportedly pulled in $3 billion in new assets last month and had $64 billion in assets under management at the end of 2014. [Inside Gundlach’s New ETF]
TOTL, which charges 0.55% per year, debuted with $112.5 million in assets under management, according to SSgA data. That makes TOTL one of the most successful new ETFs to come to market this year.