Actively managed exchange traded fund (
has emerged with an extensive whitepaper on the past, present and
future of fixed-income investing and how ETFs have helped alter the
space for all types of investors.
's paper credits fixed-income ETFs with shattering the barriers
that many investors faced when trying to enter the bond market.
Although they haven't gotten as much attention as equity ETFs,
growth in fixed-income ETFs surged 59% in the third quarter of 2009
from one year earlier.
Because the fixed-income space has become so successful, Grail
sees only continued expansion in its future. Other interesting
points in the paper include:
- Active management is an exciting development and gives
investors an appealing alternative to actively managed bond
mutual funds or indexed bond mutual funds (including ETFs). They
give diversification and tax efficiency with one trade and offer
transparency that didn't exist before. [
5 ETFs That Hedge Inflation.
- Municipal bonds are heating up. In the first three quarters
of 2009, municipal bond ETFs saw the biggest percentage of
inflows and they're one of the fastest-growing segments in the
entire industry. More than 20 muni bond funds have launched in
the last two years alone.
- The current economy has many struggling municipalities
issuing muni bonds, and high credit ratings are hard to come by.
This is why active management especially suits the muni space - a
manager than analyze a municipality on an individual basis and be
- Existing and new providers have been busily expanding their
is the largest bond-fund manager and offers several passive and
active fixed-income ETFs;
is the largest bond ETF provider with 25 funds;
is the second-largest, with 18 funds. [
Muni Bond ETFs with an End Date? Believe It.
For more stories about bond ETFs, visit our
Bond ETF category