Principal Financial Group added an actively managed fixed-income ETF that focuses on investment-grade quality debt.
Principal recently launched the Principal Investment Grade Corporate Active ETF (NYSEArca: IG), which has a 0.26% expense ratio.
The active ETF will be managed by Principal Global Investors’ John R. Friedl, Paul S. Kim, Daniela Spassova and Timothy Warrick.
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The Principal Investment Grade Corporate Active ETF will try to provide current income and capital appreciation by investing in investment-grade corporate bonds rated BBB- or higher by S&P Global Ratings or Baa3 or higher by Moody’s Investors Service, according to a prospectus sheet.
“The Fund strives to outperform its benchmark, the Bloomberg Barclays U.S. Corporate Investment Grade Bond Index, over a full market cycle. The Fund seeks to provide current income and, as a secondary objective, capital appreciation by investing in primarily investment-grade corporate bonds,” according to Principal.
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IG may include global exposures as its pool of fixed income securities covers foreign securities, corporate securities, securities issued or guaranteed by the U.S. government or its agencies and instrumentalities, and securities issued or guaranteed by foreign governments payable in U.S. dollars. Additionally, it may invest in other investment companies, including exchange-traded funds that invest in fixed income securities.
The fund does not have a specific target maturity but it will maintain an average portfolio duration that is within 10% of the duration of the Bloomberg Barclays U.S. Corporate Investment Grade Bond Index, which showed a 7.50 year duration as of March 30, 2018. The benchmark Bloomberg Barclays U.S. Corporate Investment Grade Bond Index is comprised of investment grade, fixed-rate, taxable corporate bonds, which includes U.S. dollar-denominated securities publicly issued by U.S. and non-U.S. industrial, utility, and financial issuers.
For more information on new fund products, visit our new ETFs category.