ALPS Rolls Out Active Fixed-Income ETF

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October 09, 2013
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New Riverfront ETF will go anywhere to capture yields.

The actively managed ALPS-backed RiverFront Strategic Income Fund launched today, almost three years after it went into registration with the Securities and Exchange Commission. The ETF is designed to meet investor appetite for investments that deliver solid yields.

The fund is coming out when fixed-income investors are waiting for signs from the Fed about the fate of its ultra-loose monetary policy. Many believe it will be in place for longer than had been expected until recently, given the uncertainty in the macro outlook caused by the budget-related standoff in Washington, D.C.

Enter the new ALPS ETF, “RIGS,” which will target a global portfolio of fixed-income securities of various maturities between two and 10 years, ratings and currency denominations, according to the fund’s latest prospectus. The ETF will have an annual expense ratio of 0.22 percent, or $22 for each $10,000 invested.

Specifically, the fund will invest in a basket of corporate as well as government fixed-income securities, including Government National Mortgage Association (Ginnie Mae), the Federal Housing Administration (FHA), the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac), that are both dollar- and nondollar-denominated. It will own paper of varying credit qualities.

ALPS Advisors will act as the fund’s advisor, and Richmond, Va.-based RiverFront Investment Group will be subadvisor, according to the filing.

 

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