Eq: Large Cap
A niche? Hey, almost everyone has one. So why not fixed income ETFs – non-core fixed income, especially, which “play an expanded role in portfolio construction” for institutional investors, according to the results of a survey conducted by State Street Global Advisors, reported etfdb.com.
According to the report, The Role of ETFs in a New Fixed Income Landscape, of the 700 global institutional investors SSGA surveyed with an eye on upping their exposure to high-yield corporate debt over the next 12 months, 62% likely will do so through ETFs. In contrast, only 27% of investors significantly tapped into ETFs to build their allocations to non core fixed income like high yield last year.
“The increase from just over a year ago is remarkable,” the report said.
Among larger institutions, well, the momentum especially reverberates, according to etftrends.com. Sixty eight percent of respondents generating more than $10 billion in assets indicated they’re likely to leverage ETFs to erect new exposures to high yield corporate credit.
“Our conversations with investors have reinforced what we already knew – there is significant demand for more targeted fixed income products,” said Tony Kelly, an ETF industry leader. “Our initial product suites aim to create a full toolkit for high-yield investors looking to implement their specific views on the market, and we anticipate extending this approach to other fixed income asset classes.”
Interest in directing indexing’s, well, titan
Direct indexing has drawn the attention of the titans of the asset management industry – and the reasons are obvious, according to wealthytrails.com.
Will do. There’s been a steady erosion of the fee management of mutual funds and exchange traded funds stemming from the escalation of ETFs themselves. Room is scant for addition products with more than 2,000 US ETFs and 5,000 US equity mutual funds, based exclusively on a universe of just 3,000 stocks. There’s a search for new revenue generating business areas by the industry. What’s more, interest by clients in customized portfolios, which is burgeoning, is on the radar.
Asset managers, shucking aside a commingled vehicle, execute direct indexing on the behalf of clients by assuming positions reflecting a representative samples of underlying index constituents, according to impactinvresting.com.
What does this approach yield? Customization, which abets flexibility. That includes pinpointing the index to track and exposures to circumvent -- or avoid – and potential tax advantages. That way. You can opt for the actual ingredients and directly call the underlying equities your own. Consequently, you don’t have to make purchases elsewhere.
Not a fan of leaping off a tall building in a single, crisp bound? Without a parachute? Odd but, well, okay.
Nevertheless, if that’s your mentality, you might tip your glass to active fixed income management. Afterall, one of the primary things it delivers is mitigating risk, according to npifund.ngontinh24.com.
For example, it yields investments beyond the fixed income benchmark index and facilitates the ability of managers to either push or tamp down risk. A passive strategy? Um, nada.
And active fixed income managers who have their antenna up can abandon possible issues before the wreak havoc on client portfolios, the site continued.
And that’s not all, no siree. They also rachet down interest rate sensitivity and keep their hands firmly on the wheel when it comes keeping the length of risk under their thumb, according to catalyst-insights.com. What’s more, they’re adept at uncovering yield against a low yield backdrop and get the most out of the trade off between duration exposure and yield capture.
And you might say they’re rather nimble, with an ability to seize on opportunities stemming from dynamic economic and policy shifts. A prime example, if you’re really keen on being reminded: the recent steepening of the bears. Gee, thanks, ladies and gentlemen, right?
et’s see: an IRS audit. Or this: your taxes are hightailing it north.
Then there’s the old reliable: the volatility of the financial markets.
Ah, yes. Bum, bum and, um, bummer of all.
That said, on the bright side, to leverage the dividends of tax loss harvesting, there’s direct indexing, according to advisorperspective.com.
And what’s with the gold dust direct indexing boasts in light of a topsy turvy market? Well, the investor owns the individual securities rather than a commingled fund, so they take ownership of any losses absorbed on receding stocks, the site continued. So, when it comes to offsetting gains, the investor can tap those setbacks. And, presto, that can go quite a way in paring back the tax bill of an investor.
But it’s not all tinsel town and balloons. On one hand, says experts, fees and accounts minimums might be heading south, on the other, it could be that direct indexing’s will cut a deeper swatch in your wallet and; yes, isn’t there always more: might be more difficult to deal with than passive investing, according to cnbc.com.
Category: Eq: Dividends,
Keywords: direct indexing, financial... etc.
The idea of new companies with capitating ideas and a high ceiling for growth wet your whistle? Small cap ETFs might be just your ticket, according to benzinga.com.
Opposed to large cap companies, the likelihood of exponential gains among small cap stocks is greater. On top of that, many smaller cap companies aren’t yet in the wheelhouse of institutional investors, the site continued. Plucking down cash on only a firm or two probably isn’t a sage move since smaller firms experience a certain rate of hitting the skids
Make way for small cap ETFs.
Best Small Cap ETFs:
The Best Overall: iShares Russell 2000 ETF
The Best for Active Traders: iShares Core S&P Small Cap ETF
The Best International Fund: Vanguard FTSE All-World ex-U.S. Small Cap ETF
The Best Growth Fund: SPDR S&P 600 Small Cap Growth ETF
The Best Value Fund: Vanguard Small Cap Value ETF
The Best Fund for Income: WisdomTree U.S. Small Cap Dividend ETF
According to thestreet.com, the Schwab U.S. Small Cap ETF is the top small cap ETF to add to your portfolio. While it tracks the Dow Jones U.S. Small-Cap Total Stock Market Index, it's not the S&P 600 Small Cap index or the Russell 2000. However, when it comes to exposure, it’s essentially the same.
Anyone notice that stocks, lately, have been a bit, well, prickly?
Of course, for awhile there, it segued they’d found their mojo and watching cable shows like CNBC also was a popcorn worthy occasion. Now, that viewing experience likely would give you indigestion.
In other words, yes: vo-la-ti-li-ty.
Now, could this be hitting the gas pedal on an even steeper decline.
Let’s count the possible dividends. In the short term, the wraps are on the corporate earnings season, according to ally.com, and summer? Ready to wave buh-bye. In the eye of an obvious lack of direction, it’s all but an invitation for percolating volatility, the site continued.
Meantime, investors are sliding their attention from the probabilities of a recession and how the markets will react to the Fed.
Against that less than appealing backdrop, Jesmond Mizzi Financial Advisors’ Head of Wealth Management Colin Vella, said that rather than ruing the circumstances surrounding the volatility, investors can make the best of it, according to jesmondmizzi.com.
The global initiative – unlike the war – to get a handle on COVID 19 reassured markets that bouncing back to more normal conditions could be on the short term horizon.
As the virus started to escalate worldwide, at the dawn of 2020, markets began their descent. However, the downturn didn’t have staying power and bounced back prior to the initial lockdowns.