On our most recent radio broadcast, Marie Dzanis, Head of Sales & Servicing at FlexShares, joined us to discuss the FlexShares family of ETFs. Flexshares, operated by $700+ billion asset manager Northern Trust, takes a unique approach to ETF construction by "seeking investment outcomes that help meet real-world needs such as inflation-hedging, targeting duration exposure, long term growth and liquidity". While many ETFs look to track market-cap weighted indexes (think S&P 500), FlexShares attempts to add intelligence to the process in order to meet these specific investor objectives. As ETFs soar in popularity, we continue to see more and more ETF providers offering these sort of rules-based or intelligent index ETFs. As we've said for years, ETFs have effectively "democratized" investing - bringing institutional caliber strategies to retail investors that they couldn't have dreamed of accessing just a short decade ago. ETFs such as the ones FlexShares offers are yet another example of this leveling of the investment playing field where investors can gain access to sophisticated strategies while also taking advantage of the potential benefits of ETFs at the same time (low cost, transparency, tax efficiency, etc). We discussed this particular topic in more detail with FlexShares' Marie Dzanis, who also explained why Northern Trust made the dive into ETFs to begin with.
In our weekly market update, we explained what the so-called "sequester" is and how it could potentially impact your investments. With equity markets at all-time highs and interest rates at all-time lows, we also discussed the challenges investors are facing in allocating their investments right now. In our ETF spotlight segment, given our focus on FlexShares ETFs, we delved into a very interesting TIPS (Treasury Inflation Protected Securities) ETF - the FlexShares iBoxx 3Yr Target Duration TIPS ETF (ticker TDTT). Not only was this one of the faster growing ETFs in 2012 (it scooped up over $500 million), but it also seeks to address two of the biggest concerns facing fixed income investors right now - rising interest rates and inflation.