ETF Watch: Hartford Plans Active Bond Funds

January 13, 2017

Hartford Funds, the firm that acquired Lattice Strategies and its ETFs last year, has filed to roll out two actively managed fixed-income ETFs. The Hartford Corporate Bond ETF and the Hartford Quality Bond ETF will be subadvised by Wellington Management Company.

The corporate bond ETF will target investment-grade issues, with Wellington focusing on fixed-income securities, including Treasury obligations of any maturity, that have strong credit fundamentals and attractive total return profiles, the prospectus says. The document also noted that the fund would likely draw its holdings from 100 or fewer issuers. The fund will target a duration similar to that of the Bloomberg Barclays U.S. Corporate Bond Index.

The quality bond fund will similarly target investment-grade debt, but will have a strong focus on mortgage-related securities, including mortgage-backed securities. It can also invest in Treasury obligations and hold derivatives, as well as purchase Rule 144A securities, which are privately placed and may only be sold to qualified institutional investors. The prospectus notes that the fund could trade “actively” and it has no maturity requirements. However, it will look to keep its dollar-weighted average duration between one and eight years.  

The filing did not include tickers, expense ratios or a listing exchange.

Contact Heather Bell at [email protected].

 

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