- Guggenheim Enhanced Short Duration ETF (GSY): This $907 million actively managed ETF strives to outperform the Barclays Capital 1-3 Month U.S. Treasury Bill Index. The global fund invests in a variety of fixed-income instruments, including commercial paper and bank loans, for an average maturity of 1.4 years. GSY costs a net expense ratio of 0.25%, and it’s shelling out a 30-day yield of 1.13%.
- PIMCO Enhanced Short Maturity Active ETF (MINT): This $4.9 billion actively managed fund is designed to deliver higher current income than the average money market mutual fund. It does so by investing in ultra-short-term, high-quality debt that’s global in scope. MINT costs a net expense of 0.35% and is serving up 30-day yield of 1.13%.
- FlexShares Ready Access Variable Income Fund (RAVI): This $98 million actively managed ETF owns investment-grade debt issued in the U.S. and globally. The fund currently tilts toward corporate bonds, and costs a net expense ratio of 0.25%. Its 30-day yield is about 0.75%.
Charts courtesy of StockCharts.com
“Over the long run, short-term funds that incorporate more credit risk will join government funds in benefiting from these trends,” Stringer said. “Advisors and investors will look for the best options, and if the ETFs are more competitively priced, or offer better yield—adjusting for risk—they will stand to benefit.”
Beyond the regulatory landscape, short-term bond ETFs could also benefit from investors looking to shorten their duration in anticipation of higher interest rates ahead.
So far in 2016, most of these funds have been net asset gainers. MINT, for instance, has attracted more than $835 million year-to-date, while SHV has raked in $308 million, according to FactSet data.
Contact Cinthia Murphy at [email protected]