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BSCD

Following the early release of the Fed Minutes this week, Wall Street has enjoyed a strong upward trend, encouraging ETF issuers to fill the pipeline with new funds. In total, five different firms approached the SEC with proposals for 10 new ETFs to enter the market as early as this fall [see ETF Database Launch Center]. [click to continue…]

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When managing a fixed income portfolio, there are two primary risk factors that financial advisors consider: credit risk and interest rate risk. The superstar bond fund managers of the world have set themselves apart by a superior ability to identify these risk components–and then select securities that offer superior risk-adjusted returns [see also Better-Than-AGG Total Bond Market Portfolio].

The first risk factor is easy enough to understand; the more likely an issuer of debt is to default and leave bondholders with nothing, the greater the return that will be demanded by those lending money. Companies and countries with stellar credit ratings and strong cash flow profiles can borrow funds at relatively low rates of interest, while more speculative issuers will have ot pay significantly more in interest to compensate for the additional credit risk. Disparities in credit risk explain why Wells Fargo can issue debt with a 3.75% coupon, while less stable companies such as First Data are issuing debt with coupons of about 12.6%. Many fixed income managers devote significant portions of time attempting to identify disparities between the interest companies are paying on debt and their actual credit risk; figuring out a disconnect can result in an opportunity to generate alpha.

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Bond ETFs For Every Objective

by on February 1, 2012 | Updated February 5, 2012

As the lineup of exchange-traded products has expanded dramatically in recent years, financial advisors have found themselves with more tools at their disposal than ever before. The extreme granularity of many of the equity products out there allows for cheap, low maintenance targeting of specific corners of the investable universe, while the development of some […]

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In recent years, investors have grown increasingly comfortable with the thought of achieving their fixed income exposure through ETFs. Through the first six months of 2010, bond ETFs had seen cash inflows of more than $18 billion, nearly half of the total for the ETF industry as a whole. Many of the most popular bond […]

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Investors hoping to coast through the summer months learned early in June that a summer slowdown wasn’t in the cards. Trading volumes remained elevated throughout the month, and volatility continued its impressive climb higher. With the latest developments out of Europe continuing to ripple through the global economy and fresh concerns about the best approach […]

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The latest innovation in the rapidly-growing fixed income ETF space was rolled out on Friday, as Claymore introduced a line of seven ETFs, each of which focuses on corporate bonds with maturity dates falling in a specific year. The new ETFs are:

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The impressive pace of expansion in the ETF industry slowed a bit in May, as issuers introduced fewer new funds than in previous months. Still, more than a dozen new ETFs began trading last  month, including some first-to-market products, a few ETFs that will go head-to-head with established products, and the second coming of an […]

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Claymore, the Lisle, Illinois-based ETF issuer known for its line of international and sector-specific equity funds, recently filed details on a unique series of corporate bond ETFs. The recent filings included additional details on products first mentioned in November, including:

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