Bloomberg's Businessweek reports on "cash-like" ETFs in the story, "Tempted to Mimic Mohammed El-Erian's Move Into Cash? Check Out These ETFs." It says, "The news that Mohamed El-Erian has his portfolio largely in cash has many investors wondering if they should follow suit. But what may make sense for a megamillionaire's portfolio isn't necessarily a good move for people with much more modest holdings.... But if average investors are tempted to move some money out of the market, actively managed "enhanced" money-market exchange-traded funds may be a good option. These ETFs offer a way to earn some income and ward off any bite from inflation without taking on much risk. These ETFs live in the space between money-market funds and short-term bond funds. They generally hold all investment-grade bonds from a variety of issuers with weighted average maturities of around a year or less. The largest actively managed ETF of the bunch is the Pimco Enhanced Short Maturity Active Exchange-Traded Fund (MINT). It has 70 percent of its assets in corporate bonds and 16 percent in mortgage bonds; the rest is in U.S. treasuries and municipal bonds. Half of its holdings are outside the U.S., in bonds from South Korea, the United Kingdom, and Switzerland. That mix of holdings adds up to a yield of 0.80 percent, and the ETF returned 0.60 percent in the past year, after fees.... MINT charges 0.35 percent in annual fees. Blackrock's answer to MINT is the iShares Short Maturity Bond ETF (NEAR). It focuses almost entirely on U.S. government debt but picks up yield by holding some bonds with maturities between one and three years. That combination produces a yield of 0.84 percent and a one-year return of 0.74 percent after fees. NEAR has $626 million in assets and an annual fee of 0.25 percent. Further out on the risk spectrum is Guggenheim Enhanced Short Duration ETF (GSY), which has a 1.4 percent yield and a one-year return of 0.93 percent, after fees. GSY manages to earn that by adding 15 percent in high-yield debt to a portfolio of mostly investment-grade corporate and government bonds that mature in less than a year. It charges investors 0.27 percent of assets under management." (Look for more coverage of the ultra-short bond and ETF market in our next Bond Fund Intelligence, which will ship to Crane Data subscribers next week.) In other news, the Federal Reserve released the Minutes from its March 17-18 FOMC meeting. (Watch for excerpts and its comments on rates and the RRP program tomorrow.)

Email This Article




Use a comma or a semicolon to separate

captcha image

Daily Link Archive

2024 2023 2022
March December December
February November November
January October October
September September
August August
July July
June June
May May
April April
March March
February February
January January
2021 2020 2019
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2018 2017 2016
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2015 2014 2013
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2012 2011 2010
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2009 2008 2007
December December December
November November November
October October October
September September September
August August August
July July July
June June June
May May May
April April April
March March March
February February February
January January January
2006
December
November
October
September