A New Active Short-Term Bond ETF to Better Preserve Capital

“Short duration fixed income securities may provide better income potential than money market and ultra-short duration funds. Also, we believe they are less affected by rising interest rates than longer duration fixed income securities,” according to Natixis.

The active fund will largely invest in investment-grade fixed-income securities, but it may invest up to 15% of assets in bonds rated below investment grade. The fund may also hold U.S. dollar-denominated foreign securities, including emerging market securities.

When deciding which securities to buy and sell, Loomis Sayles will consider a number of factors related to the bond issue and the current bond market, including the stability and volatility of a country’s bond markets, the financial strength of the issuer, current interest rates, current valuations and Loomis Sayles’ expectations regarding general trends in interest rates. The active ETF managers will also consider how purchasing or selling a bond would impact the portfolio’s risk profile and potential return.

For more information on new fund products, visit our new ETFs category.