The fund is actively managed and competitively priced at 15 basis points, or 12 basis points lower than the average active ETF in its category. The active ETF also tries to generate a diversified source of alpha through high-quality positioning that covers consistent and sustainable sources across investment-grade sectors to help maintain stability of principal.

The ETF’s portfolio follows an ultra-short duration, risk-managed approach that helps fixed-income investors to hedge against rising rates while enhancing or diversifying a cash management strategy. When you look at this strategy, it’s not cash, but it must be close from a liquidity management and duration perspective, and that’s how they plan to manage it.

PULS shows a 2.67% 30-day SEC yield and a 0.2 year duration – so a 1 percent rise in interest rates would only translate to a 0.2% decline in the fund’s price.

For more market-related commentary from Tom Lydon and other industry experts, visit our ETF Trends video category.

CORRECTION: updated SEC yield

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