Arrow Investments files for three actively managed income-generating ETFs dressed for a low-yield era.
Arrow Investments filed regulatory paperwork detailing plans to market three actively managed income-generating ETFs to the table, adding to the issuer’s sole fund currently on the market, the Arrow Dow Jones Global High Yield ETF (NYSEArca: GYLD).
The three funds in this filing each take a different route to payout enhancement, though all three will be “funds of funds,” holding exchange-traded products within their constituents. Arrow Investments will actively manage all three funds.
Arrow Investments also has one other ETF currently in registration, a high-yield-focused fund that will be called the Arrow Global Enhanced High Yield Bond ETF.
GYLD, which launched in May 2012, and provides access to globally allocated, high-yielding securities, has accumulated nearly $80 million in assets during its year on the market, no small sum for an ETF upstart like Arrow.
Maryland-based Arrow Investments’ introduction of GYLD came at a time when high-yielding securities were gaining ground as an alternative source of investment income. The three new funds in the issuer’s most recent filing serve as another piece of evidence that investors are hungrier than ever for income in the ultra-low-rate investment world that predominates in the post-crash world.
The funds in this filing and their respective strategies are:
- The Arrow Balanced ETF will maintain equilibrium by allocating no more than 65 percent and no less than 25 percent to both equity and fixed-income securities, and no more than 40 percent but no less than 10 percent to alternative assets, like commodities and real estate.
- The Arrow Tactical ETF will invest in “securities without restriction as to capitalization, credit quality or country,” according to the prospectus, and will use “technical analysis to allocate the Fund’s assets among equity, fixed income, and alternative asset market segments.” The prospectus defines technical analysis as “the method of evaluating securities by analyzing statistics generated by market activity, such as past prices and trading volume, in an effort to determine probable future prices.”
- The Arrow Tactical Yield ETF will hold fixed-income and high-yielding exchange-traded products, investing between 20 and 80 percent of both high- and low-beta securities, both domestic and international.
Arrow Investments hasn’t yet attached a ticker or quoted a price for any of the three funds, but it did say each will have a primary listing on Arca, the New York Stock Exchange’s electronic trading platform.