Hartford Launches Muni Fund

Today Hartford has rolled out its 11th ETF, which offers actively managed exposure to the municipal bond space. The Hartford Municipal Opportunities ETF (HMOP) is subadvised by Wellington Management Company.

HMOP comes with an expense ratio of 0.35% and lists on the NYSE Arca.

It can invest in both investment-grade and noninvestment-grade debt, and selects holdings based on attractive yields and the likelihood of total returns. As much as 35% of the portfolio can be rated as less than investment grade. The fund is designed to provide tax-exempt income and long-term total return, according to the prospectus, but it is allowed to invest in securities that are not tax exempt.

HMOP will seek to diversify its holdings across sectors and states, and it has no requirements regarding the maturity or duration of its holdings, the document indicates.

The largest competing fund appears to be the First Trust Managed Municipal Bond ETF (FMB), which has $256 million in assets under management and comes with an expense ratio of 0.50%.

Energy Independence ETF Debuts

Yesterday SL Advisors rolled out an ETF targeting midstream energy infrastructure companies. The American Energy Independence ETF (USAI) tracks an index developed by its issuer. USAI is SL Advisors’ first ETF.

The fund lists on the NYSE Arca and comes with an expense ratio of 0.75%.

Methodology

The index holds the securities of U.S.- and Canada-listed companies likely to benefit from regulations and policies that support American energy independence, the prospectus says. The companies selected can be drawn from the small-, mid- and large-cap segments, but must have at least $500 million in market capitalization.

The components are involved in and generate most of their cash flow from a range of midstream activities, including gathering and processing, compression, fractionation, logistics, midstream services, pipeline transportation, storage and terminaling of fossil fuels, among other business activities.

The prospectus specifically notes that companies operating primarily in the refining, shipping, exploration, retail distribution or oil services segments are excluded from the index.  

Companies fall into five categories with set weights: U.S. general partnerships that are treated as partnerships for tax purposes (weighted at 15%); U.S. general partnerships that are treated as corporations for tax purposes (35%); U.S. companies (20%); Canadian companies (25%); and U.S. master limited partnerships (5%).

The index rebalances quarterly. Companies are weighted by modified market capitalization. As of the end of November, there were 28 securities in the index.  

Contact Heather Bell at [email protected]