Wednesday, 23 November 2022 03:41

Fixed income ETFs a player in portfolio construction

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Fixed income ETFs – and non core fixed income, especially? You go. According to a survey by State Street Global Advisors, they “play an expanded role in portfolio construction” for institutional investors, stated etftrends.com.

As reported in last month, over the next 12 months, the 700 global institutional investors surveyed by SSGA plan to up their exposure to high yield corporate debt; in all likelihood, 62% will do it through ETFs, per “The Role of ETFs in a New Fixed Income Landscape.” Last year was a different story. Just 27% of investors were significantly using ETFs to expand their allocation of to non core fixed income, according to the last year’s fixed income survey.

“Our conversations with investors have reinforced what we already knew – there is significant demand for more targeted fixed income products,” said Tom Kelly, an ETF industry leader co founder. “Our initial product suites aim to create a full toolkit for high-yield investors looking to implement their specific views on the market, and we anticipate extending this approach to other fixed income asset classes.”

Now, with minds of their own, bless ‘em, younger investors are more inclined to place emphasis on total returns over income potential, according to usnews.com.

Almost on the dime, they reinvest dividends – any dividends, while investors who’ve been around the block oh, say, a time or two, might place greater importance on the possibility of greater income. For a steady income to accommodate living expenses, they could lean on their portfolios.

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