With the Federal Reserve expected to hike interest rates and make waves in the fixed-income market, bond investors may consider actively managed exchange traded funds that are able to quickly adapt to the changes and modify positions to conform to a higher rate environment.
On the upcoming webcast, ETF Active Management: How You Can be a Part of its Success, Dave Mazza, Head of ETF & Mutual Fund Research at State Street Global Advisors, David Haviland, Portfolio Manager and Managing Partner of Beaumont Capital Management, and Marc Pfeffer, Senior Portfolio Manager at CLS Investments, will outline the current fixed-income market condition and look to active ETF options in a rising rate environment.
For instance, State Street Global Advisors offers a range of active bond ETFs that may be more nimble in changing market conditions. For instance, the SPDR DoubleLine Total Return Tactical ETF (NYSEArca: TOTL) has been a popular active bond play for ETF investors. TOTL is an actively managed ETF backed by bond guru Jeff Gundlach and is also seen as an ETF adaptation of the flagship DoubleLine Total Return Fund (DLTNX).
DoubleLine and SSGA have also partnered up with the more recently launched SPDR DoubleLine Short Duration Total Return Tactical ETF (BATS: STOT) and SPDR DoubleLine Emerging Markets Fixed Income ETF (BATS: EMTL).
STOT seeks to maximize current income with a dollar- weighted average effective duration between one and three years. STOT is managed by Jeffrey Gundlach, chief executive officer and chief investment officer of DoubleLine Capital, Philip Barach, DoubleLine president and Jeffrey Sherman.
EMTL seeks to provide high total return from current income and capital appreciation. EMTL is managed by Luz Padilla, director of DoubleLine’s International Markets Fixed Income Team, Mark Christensen and Su Fei Koo. The fund tries to maintain a weighted average effective duration between two and eight years through active security selection that combines bottom-up research with sovereign macro overlays.
The actively managed bank loan ETF options could provide investors with better exposure as a manager is more freely able to weave in and out of the fixed-income market. Blackstone/GSO, the subadvisor of SRLN, is one of the largest senior loan asset managers in the world.
Financial advisors who are interested in learning more about actively managed ETFs can register for the Tuesday, October 11 webcast here.