There are currently 17 actively managed ETFs trading in the United States right now, and the ones raking in the most assets are those focused on the fixed-income space. Why is this?
Many actively managed ETFs are still trying to build track records and prove that they can generate alpha in order to lure investors. One segment of the space that’s appealing to investors right now are actively managed fixed-income funds, says Shishar for In Focus.
What gives? One reason is the names behind some of these funds. PIMCO has launched several active bond ETFs, and one of those – PIMCO Enhanced Short Maturity (NYSEArca: MINT) – has already surpassed $115 million in assets. PIMCO has a strong reputation in the fixed-income market, so it’s no surprise that investors are eager to take advantage of their expertise in a low-cost, transparent format.
Investors might also be finding actively managed bond funds appealing because of just that – they’re actively managed. In these uncertain credit conditions, having a portfolio that adjusts accordingly may be of great comfort to many investors who don’t want to have to do the shifting and changing themselves.
Another reason could simply be that equity markets haven’t been on solid footing since most active funds have launched. The majority of actively managed equity ETFs were released in late 2008 and into 2009 – hardly heady times for the markets. Although there has been a rally, investors were slow to be convinced that it would stick for the long haul.