Displaying items by tag: ETFs

Thursday, 03 February 2022 19:16

The Best Active Fixed Income ETFs for 2022

The fixed income ETF market took a hit in 2020, and it's been a very slow recovery. Still, active funds outperformed during this time period, and that trend could continue into 2022. A stand-out active bond ETF to consider is Fidelity Total Bond ETF. it’s seen stellar performance when compared to its peers and its managers are committed to ensuring liquidity. Another ETF to watch out for is Pimco enhanced Short Maturity Active ETF. This fund is more centered around stability and security with less risky management. However, avoiding high yield corporate debt and currency risk these factors can make it a safer alternative in the upcoming cycles.


FINSUM: Shorter duration active bond ETFs are really important to consider right now because they mitigate the single biggest risk that exists in bond markets: rising rates.

Published in Bonds: Total Market
Friday, 28 January 2022 14:11

Fixed Income ETFs Grant Freedom and Flexibility

New survey data is out regarding how investors are utilizing fixed income ETFs and how they are represented in a portfolio. In 2021 Fixed income represented about 18% of global ETF assets under management, and many investors plan on increasing their use going forward. The number one purpose for fixed income ETFs was for liquidity management as 83% of surveyors use them in this way. However, transition management, derivative complementarity, and tactical adjustments were also highly cited reasons for their use. Many draw on fixed income ETFs for liquidity purposes, and this is particularly evident in the bid-ask spreads. Relative to their underlying securities ETF spreads for HYG were 48x smiler than the underlying assets.


FINSUM: It's clear investors aren’t terribly worried about lower yields and rising interest rates, these ETFs are giving freedom and flexibility in investors’ portfolios.

Published in Bonds: Total Market
Monday, 24 January 2022 09:34

Dimensional Dominating Active ETF Space

David Booth’s Dimensional Advisors hasn’t been a part of the active ETF market for long in fact just a meager 14 months, but that hasn’t stopped it from rising to the top of the active market. Since last November they have rocketed to over $46 billion in active assets. Overall active management is growing rapidly and going to be a trillion-dollar trend of converting mutuals to ETF’s. However, Dimensional’s newly launched active fixed-income is flying off the shelves with nearly $1 billion in assets since their inception in November. While the lion’s share has been converted, this fixed-income segment is among some of the fastest pure growth in the fixed income ETF market.


FINSUM: Within the ETF segment, active ETFs have been growing strongly, and this is at the forefront of a new trend.

Published in Eq: Total Market
Wednesday, 19 January 2022 19:32

Four Active ETFs for Income Outperformance

Active funds get overlooked by many investors in their retirement portfolios because investors view them with a certain amount of risk aversion. However, rising inflation and positive income expectation make them a viable investment alternative. For global diversity, investors should consider SPDR SSgA Global Allocation ETF and the Invesco Optimum Yield Diversified Commodity Strategy No K-1 ETF which have unique exposures. For those wanting to maintain fixed income exposure but better yield, First Trust Low Duration Opportunities ETF and First Trust Prefered Securities Income ETF are both debt-focused funds that are great for retirement. Active ETFs have a fee advantage over the often considered mutual funds.


FINSUM: These are great alternatives given the pending interest rate and inflation risk that are both permeating bond markets.

Published in Eq: Dividends
Thursday, 13 January 2022 17:25

Are ETFs Piggybacking on Annuities?

Covid-19’s continued crisis and the growing number of new strands have put lots of pressure on bond markets which has spiked an interest in annuities because there is no yield in fixed income. However, ETFs are looking to capitalize on annuities growing popularity because a defined outcome ETFs offer a lot of the same advantages as annuities. Buffer or defined outcome ETFs use options to track indices which means that by buying a series of put options and selling a series of call options they cap and floor their earnings which means a smooth stable ride that is an alternative to bond markets and annuities as an equity hedge. They also have an advantage over annuities because they don’t have the hefty upfront costs annuities usually have.


FINSUM: This is a great product to hedge the S&P but it isn’t the guaranteed income an annuity provides.

Published in Wealth Management
Page 39 of 62

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