Investors can no longer sit back and enjoy an easy ride. As volatility spikes, some turned to exchange traded fund strategies that can better adapt to the changing market conditions.
“We spend all of our time kind of underneath the hood, talking about how to construct portfolios, where the wires really need to match right now, and as these conversations continue to evolve and the markets aren’t one direction anymore, it’s not just about how much you’re paying for something. It’s really about how you’re assembling it, and things like factors and active management have come to the forefront in a lot of these conversations,” Matt Raynor, Managing Director of National Accounts, Sub-advisory, Exchange Traded Fund Sales, Principal Global Investors, said at the Charles Schwab IMPACT 2018 conference.
Principle is known for its asset allocation at the core, and the money manager has launched ETF versions of its core strategies. For example, the Principal EDGE Active Income ETF (NYSEArca: YLD) is an actively managed multi-asset fund. Multi-asset exchange traded funds have provided diversified exposure to a group of various asset classes and generated attractive yields and have become income investor favorites as advisors and investors searched for new yield sources amid several years of rock-bottom U.S. interest rates.
YLD seeks to generate consistent income through changing market environments and over market cycles. It invests opportunistically across a diversified range of income-generating asset classes while managing for risk. EDGE’s proven investment process, long history of income investing, and strong risk management and credit research capabilities may help enhance returns while reducing risks.
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