Daily ETF Watch: Gundlach Takes On BOND

Look out, Gross; here comes Gundlach!

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Reviewed by: Hung Tran
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Edited by: Hung Tran

Jeffrey Gundlach’s DoubleLine Capital, along with State Street Global Advisors, has filed regulatory paperwork to market the SPDR DoubleLine Total Return Tactical ETF, an active fixed-income fund that will look to go head-to-head with Bill Gross’ successful ETF version of the Pimco Total Return Fund.

It took less than three months for the $3.4 billion Pimco Total Return ETF (BOND) to reach $1 billion in assets after its March 1, 2012 launch—its instant success a reflection of Gross’ star quality and of a hunger for yield that prevails among investors in this post-crash era of financial repression.

The search for yield continues to be a theme for investors in 2014. However, BOND has had outflows of $245 million year-to-date, according to data compiled by ETF.com Analytics, as investors continue pouring money into U.S. equity ETFs, thanks in part to the S&P 500 Index’s climb to record highs.

Gundlach’s latest filing also tells the broader tale of traditional mutual fund stalwarts looking to move into the fast-growing ETF industry via partnerships with ETF issuers a la TCW, Gundlach’s former employer, a joint venture with Emerging Global Advisors earlier this year.

Total assets in U.S.-listed ETFs ended May just about at a record high of $1.804 trillion, according to data compiled by ETF.com Analytics.

The Gundlach/SSgA fund’s investment universe will consist of a diversified portfolio of fixed-income securities, including notes issued or guaranteed by the U.S. government or its agencies; inflation-protected public obligations of the U.S. Treasury (TIPS); foreign and domestic corporate bonds; and other securities bearing fixed-interest rates of any maturity, according to the regulatory paperwork.

The newly proposed offering is part of a “master feeder” structure and will invest all of its assets in the SSgA DoubleLine Total Return Tactical Portfolio. Associated fees and tickers were not made available in the filing.

 

Filing

iShares is giving two of its “Core” bond ETFs a facelift.

Effective June 3, the iShares Core Short-Term U.S. Bond ETF (ISTB | A-69) will change its name to the iShares Core Short-Term USD Bond ETF, according to an NYSE communique. The fund will also switch its current index from the Barclays U.S. Government/Credit 1-5 Year Bond Index to the Barclays US 1-5 Year Universal Index.

Also, the iShares Core Long-Term U.S. Bond ETF (ILTB | C-92) will be renamed the iShares Core Long-Term USD Bond ETF and will swap its current Barclays U.S. Long Government/Credit Bond Index for the Barclays US 10+ Year Universal Index.

 

 

Hung Tran is a former staff writer for etf.com.