Actively managed exchange traded funds have been overshadowed by their passive index-based peers, but more investors are beginning to consider the strategies and benefits behind these active products.
“Invesco ETFs pioneered active ETFs back in 2008. We worked with the active real estate team at Invesco to launch PSR, which is based on REITs, and then from there, we’ve also been able to build fixed-income… a huge growth area,” Dan Draper, Managing Director, Global Head of Invesco ETFs & UITs, Invesco, said at the Inside ETFs conference.
The Invesco Active U.S. Real Estate ETF (NYSEArca: PSR) first came to market on November 20, 2008. The actively managed ETFs selects securities that are included within the FTSE NAREIT All Equity REITs Index, and the active manager’s methodology uses quantitative and statistical metrics to identify attractively priced securities and manage risk.
The Invesco Ultra Short Duration ETF (NYSEArca: GSY) is now Invesco’s most popular actively managed ETF strategy, with $2.2 billion in assets under management. The ultra-short-duration bond ETF may be seen as a money market fund alternative that targets fixed income securities of varying maturities with an average duration of less than one year.
Additionally, the Invesco DB Optimum Yield Diversified Commodity Strategy Portfolio (NasdaqGM: PDBC) is a popular, actively managed commodity ETF play. PDBC tries to negate the negative effects of contango in the commodities market by selecting futures contracts with the highest implied roll yield.
Watch Dan Draper Discuss Active ETFs:
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