Self Directed Investor Inc
SDI: "Empowering investors with ideas and education"
Symbol Lookup »  
Topics:ChinaETFsEarningsEconomyEnergyForexGoldIncomeLessonsIdeasTrading

  • Other news: News from PR Newswire
| More

Grail Launches Two Active Bond ETFs

Fri, Jan 29, 10:16 AM ET, by Michael Johnston

Grail Advisors, known in the ETF world as the issuer responsible for the first actively-managed ETF that allowed managers total discretion, announced today the launch of two actively-managed fixed income ETFs. The Grail McDonnell Intermediate Municipal Bond ETF (GMMB) and the Grail McDonnell Core Taxable Bond ETF (GMTB) began trading on the NYSE Arca Exchange on Friday, bringing the total number of ETFs in Grail’s product line to seven.

Grail Advisors will serve as the manager for both funds with Chicag0-based McDonnell Investment Management sub-advising both funds. The muni bond ETF will seek outperform the Barclays Capital 3-15 Year Municipal Bond Index by identifying opportunities among states, sectors, securities, and exploiting the changing shape of the yield curve. The taxable bond ETF will be an actively-managed alternative to existing total bond market funds. GMTB is benchmarked to the Barclays Capital Aggregate Bond Index, which is also linked to total bond funds from Vanguard (BND) and iShares (AGG).

Both new funds will charge a net expense ratio of 0.35%, extremely low for an actively-managed ETF. But this cost structure still leaves a big “alpha gap” that must be filled in order to be competitive with passively-indexed competitors. BND charges just 0.14%, meaning that GMTB must consistently beat its benchmark by 20 basis points per year. The iShares S&P National AMT-Free Municipal Bond Fund (MUB) charges 0.25%, essentially putting GMMB in a 10 basis point hole from the start.

Slow Start For Active ETFs

Grail broke on to the ETF scene last year with the launch of the Grail American Beacon Large Cap Value ETF (GVT), the first actively-managed ETF to allow manager discretion in the selection of holdings (PowerShares launched a line of active ETFs in 2008 that utilize proprietary stock-ranking methodologies to determine holdings). At the time, the “Grail Fund” was touted by many in the industry (including ETF Database) as a gamechanger that would open the floodgates to a wave of active ETFs.

Grail ETF Assets
TickerInceptionAssets ($M)
GVT5/09$3
RPX10/09$3
RWG10/09$3
RPQ10/09$3
RFF10/09$3
Source: December NSX Data

But the market’s reception of actively-managed ETFs equity has been been tepid. At the end of 2009 GVT had only about $3 million in assets, as did four other actively-managed funds launched in October.

Active ETFs in the fixed income space have seen much more success. PIMCO introduced two actively-managed bond funds last year, including a short maturity strategy fund (MINT) and muni bond fund (MUNI). These ETFs took in about $50 million in cash in 2009, and have continued to grow this year.

Of course part of PIMCO’s success is attributable to the bond giant’s reputation and market leader status, something Grail’s funds won’t necessarily have. McDonnell has a long and impressive track record in the bond management business, but the name doesn’t carry the same weight as PIMCO in the investment community.

The addition of GMMB and GMTB brings the total for new fund launches in January to 23, putting the industry on pace to more than double last year’s new product output. See a summary of all the month’s fund launches and sign up for the free ETF newsletter to get updates on all new ETF launches.

Disclosure: Long BND.


SDI Glossary: "Asset" Definition
SDI Glossary: "Bond" Definition
SDI Glossary: "Exchange" Definition
SDI Glossary: "ETFs" Definition
SDI Glossary: "iShares" Definition
SDI Glossary: "NYSE" Definition
SDI Glossary: "NI" Definition
This Article's Word Cloud:   Active   Advisors   Bond   Capital   ETFs   Fund   GMMB   GMTB   Grail   Index   McDonnell   Municipal   PIMCO   active   actively   basis   bond   both   charges   discretion   first   fixed   from   fund   funds   have   holdings   iShares   including   income   industry   last   launch   launched   launches   line   managed   manager   market   million   muni   must   product   success   that   this   total   will   with   year

| More

Danaher Moves Up In Analyst Rankings, Passing Anadarko Petroleum
Tue, Jul 22, 1:14 PM ET, by ETF Channel

In a study of analyst recommendations at the major brokerages, for the underlying components of ...

RWM: ETF Inflow Alert
Tue, Jul 22, 11:34 AM ET, by ETF Channel

Symbols mentioned in this story: RWM Exchange traded funds (ETFs) trade just like stocks, but ...

SPDR Dow Jones International Real Estate ETF Experiences Big Inflow
Tue, Jul 22, 11:34 AM ET, by ETF Channel

Symbols mentioned in this story: RWX, BAM.A.CA, REI.UN.CA, HR.UN.CA Exchange traded funds (ETFs) trade just ...

FXZ, TMST, RYAM, FCX: ETF Inflow Alert
Tue, Jul 22, 11:34 AM ET, by ETF Channel

Symbols mentioned in this story: FXZ, TMST, RYAM, FCX Exchange traded funds (ETFs) trade just ...

VB, SLXP, FL, AJG: ETF Inflow Alert
Tue, Jul 22, 11:34 AM ET, by ETF Channel

Symbols mentioned in this story: VB, SLXP, FL, AJG Exchange traded funds (ETFs) trade just ...

SPXU: ETF Inflow Alert
Tue, Jul 22, 11:34 AM ET, by ETF Channel

Symbols mentioned in this story: SPXU Exchange traded funds (ETFs) trade just like stocks, but ...

EFA, AI, CS, AIR: Large Inflows Detected at ETF
Tue, Jul 22, 11:34 AM ET, by ETF Channel

Symbols mentioned in this story: EFA, AI, CS, AIR Exchange traded funds (ETFs) trade just ...

18.0% of FDM Holdings Seeing Recent Insider Buys
Tue, Jul 22, 9:44 AM ET, by ETF Channel

A look at the weighted underlying holdings of the First Trust Dow Jones Select MicroCap ...

CAT a Top 25 Dividend Giant With $3.51B Held By ETFs
Tue, Jul 22, 8:14 AM ET, by ETF Channel

Caterpillar Inc. (CAT) has been named as a Top 25 ''Dividend Giant'' by ETF Channel, ...

PepsiCo Inc. a Top Socially Responsible Dividend Stock With 2.9% Yield (PEP)
Tue, Jul 22, 8:14 AM ET, by ETF Channel

PepsiCo Inc. (PEP) has been named a Top Socially Responsible Dividend Stock by Dividend Channel, ...

Notable Two Hundred Day Moving Average Cross - IEV
Mon, Jul 21, 5:24 PM ET, by ETF Channel

In trading on Monday, shares of the iShares Europe ETF (IEV) crossed below their 200 ...

Google Takes Over #14 Spot From Facebook
Mon, Jul 21, 12:14 PM ET, by ETF Channel

In a study of analyst recommendations at the major brokerages, for the underlying components of ...

See How Pfizer Ranks Among Analysts' Top Dow 30 Picks
Mon, Jul 21, 12:14 PM ET, by ETF Channel

A study of analyst recommendations at the major brokerages shows that Pfizer Inc (PFE) is ...

iShares MSCI Germany Small-Cap Getting Very Oversold
Mon, Jul 21, 11:34 AM ET, by ETF Channel

In trading on Monday, shares of the iShares MSCI Germany Small-Cap ETF (EWGS) entered into ...

WisdomTree Barclays U.S. Aggregate Bond Negative Duration Fund (AGND) Enters Oversold Territory
Mon, Jul 21, 11:34 AM ET, by ETF Channel

In trading on Monday, shares of the WisdomTree Barclays U.S. Aggregate Bond Negative Duration Fund ...

Shares of HYLS Now Oversold
Mon, Jul 21, 11:34 AM ET, by ETF Channel

In trading on Monday, shares of the First Trust Tactical High Yield ETF (HYLS) entered ...

JDST Crowded With Sellers
Mon, Jul 21, 11:34 AM ET, by ETF Channel

In trading on Monday, shares of the Daily Junior Gold Miners Index Bear 3x Shares ...

RSP, VRTX, WMB, COV: Large Inflows Detected at ETF
Mon, Jul 21, 11:14 AM ET, by ETF Channel

Symbols mentioned in this story: RSP, VRTX, WMB, COV Exchange traded funds (ETFs) trade just ...

12.7% of VBR Holdings Seeing Recent Insider Buys
Mon, Jul 21, 9:44 AM ET, by ETF Channel

A look at the weighted underlying holdings of the Vanguard Small-Cap Value ETF (VBR) shows ...

Procter & Gamble a Top Socially Responsible Dividend Stock With 3.2% Yield (PG)
Mon, Jul 21, 9:24 AM ET, by ETF Channel

Procter & Gamble Co. (PG) has been named a Top Socially Responsible Dividend Stock by ...

Why Public Storage is a Top 25 Dividend Giant (PSA)
Mon, Jul 21, 9:24 AM ET, by ETF Channel

Public Storage (PSA) has been named as a Top 25 ''Dividend Giant'' by ETF Channel, ...

Shares of SSG Now Oversold
Fri, Jul 18, 4:57 PM ET, by ETF Channel

In trading on Friday, shares of the Proshares UltraShort Semiconductors ETF (SSG) entered into oversold ...

Guggenheim Enhanced Short Duration (GSY) Shares Cross Below 200 DMA
Fri, Jul 18, 4:57 PM ET, by ETF Channel

In trading on Friday, shares of the Guggenheim Enhanced Short Duration ETF (GSY) crossed below ...

GERJ Makes Notable Cross Below Critical Moving Average
Fri, Jul 18, 4:57 PM ET, by ETF Channel

In trading on Friday, shares of the Germany Small-Cap ETF (GERJ) crossed below their 200 ...

UPRO, ADBE, AES, AET: Large Outflows Detected at ETF
Fri, Jul 18, 11:32 AM ET, by ETF Channel

Symbols mentioned in this story: UPRO, ADBE, AES, AET Exchange traded funds (ETFs) trade just ...

VPL, BHP, WBK, MTU: Large Inflows Detected at ETF
Fri, Jul 18, 11:32 AM ET, by ETF Channel

Symbols mentioned in this story: VPL, BHP, WBK, MTU Exchange traded funds (ETFs) trade just ...

FXE: ETF Outflow Alert
Fri, Jul 18, 11:32 AM ET, by ETF Channel

Symbols mentioned in this story: FXE Exchange traded funds (ETFs) trade just like stocks, but ...

Johnson & Johnson a Top Ranked SAFE Dividend Stock With 2.8% Yield (JNJ)
Fri, Jul 18, 9:20 AM ET, by ETF Channel

Johnson & Johnson (JNJ) has been named to the Dividend Channel ''S.A.F.E. 25'' list, signifying ...

McDonald's a Top Socially Responsible Dividend Stock With 3.3% Yield (MCD)
Fri, Jul 18, 9:20 AM ET, by ETF Channel

McDonald's Corp (MCD) has been named a Top Socially Responsible Dividend Stock by Dividend Channel, ...

BSJG Crowded With Sellers
Thu, Jul 17, 4:56 PM ET, by ETF Channel

In trading on Thursday, shares of the Guggenheim BulletShares 2016 High Yield Corporate Bond ETF ...

FYX Makes Notable Cross Below Critical Moving Average
Thu, Jul 17, 4:56 PM ET, by ETF Channel

In trading on Thursday, shares of the First Trust Small Cap Core AlphaDEX Fund ETF ...

GUR Makes Notable Cross Below Critical Moving Average
Thu, Jul 17, 4:56 PM ET, by ETF Channel

In trading on Thursday, shares of the SPDR S&P Emerging Europe ETF (GUR) crossed below ...

SUB Makes Bullish Cross Above Critical Moving Average
Thu, Jul 17, 4:56 PM ET, by ETF Channel

In trading on Thursday, shares of the iShares Short-Term National AMT-Free Muni Bond ETF (SUB) ...

HYG Makes Notable Cross Below Critical Moving Average
Thu, Jul 17, 4:56 PM ET, by ETF Channel

In trading on Thursday, shares of the iShares iBoxx $ High Yield Corporate Bond ETF ...

Brazil Small-Cap Breaks Below 200-Day Moving Average - Notable for BRF
Thu, Jul 17, 4:56 PM ET, by ETF Channel

In trading on Thursday, shares of the Brazil Small-Cap ETF (BRF) crossed below their 200 ...

FDM Makes Notable Cross Below Critical Moving Average
Thu, Jul 17, 4:56 PM ET, by ETF Channel

In trading on Thursday, shares of the First Trust Dow Jones Select MicroCap Index Fund ...

IYJ, CAT, ACN, EMR: Large Outflows Detected at ETF
Thu, Jul 17, 12:32 PM ET, by ETF Channel

Symbols mentioned in this story: IYJ, CAT, ACN, EMR Exchange traded funds (ETFs) trade just ...

ESR Crosses Below Key Moving Average Level
Thu, Jul 17, 12:32 PM ET, by ETF Channel

In trading on Thursday, shares of the iShares MSCI Emerging Markets Eastern Europe ETF (ESR) ...

SPDR S&P Russia Breaks Below 200-Day Moving Average - Notable for RBL
Thu, Jul 17, 12:32 PM ET, by ETF Channel

In trading on Thursday, shares of the SPDR S&P Russia ETF (RBL) crossed below their ...

HYXU Crosses Below Key Moving Average Level
Thu, Jul 17, 12:32 PM ET, by ETF Channel

In trading on Thursday, shares of the iShares Global ex USD High Yield Corporate Bond ...

PHO Crosses Below Key Moving Average Level
Thu, Jul 17, 12:32 PM ET, by ETF Channel

In trading on Thursday, shares of the PowerShares Water Resources Portfolio ETF (PHO) crossed below ...

ICF, HCN, HCP, VNO: Large Inflows Detected at ETF
Thu, Jul 17, 12:32 PM ET, by ETF Channel

Symbols mentioned in this story: ICF, HCN, HCP, VNO Exchange traded funds (ETFs) trade just ...

EMC Takes Over #41 Spot From Alexion Pharmaceuticals
Thu, Jul 17, 12:32 PM ET, by ETF Channel

In a study of analyst recommendations at the major brokerages, for the underlying components of ...

United Technologies a Top 25 Dividend Giant With 2.07% Yield (UTX)
Thu, Jul 17, 10:17 AM ET, by ETF Channel

United Technologies Corp. (UTX) has been named as a Top 25 ''Dividend Giant'' by ETF ...

VZ Named A Top Socially Responsible Dividend Stock
Thu, Jul 17, 10:17 AM ET, by ETF Channel

Verizon Communications Inc (VZ) has been named a Top Socially Responsible Dividend Stock by Dividend ...

FKO Crosses Below Key Moving Average Level
Wed, Jul 16, 5:17 PM ET, by ETF Channel

In trading on Wednesday, shares of the First Trust South Korea AlphaDEX Fund ETF (FKO) ...

First Trust Large Cap Core AlphaDEX Fund Experiences Big Outflow
Wed, Jul 16, 11:32 AM ET, by ETF Channel

Symbols mentioned in this story: FEX, MU, NFX, APA Exchange traded funds (ETFs) trade just ...

iShares 1-3 Year International Treasury Bond (ISHG) Shares Cross Below 200 DMA
Wed, Jul 16, 11:32 AM ET, by ETF Channel

In trading on Wednesday, shares of the iShares 1-3 Year International Treasury Bond ETF (ISHG) ...

GDX, GG, ABX, NEM: ETF Outflow Alert
Wed, Jul 16, 11:32 AM ET, by ETF Channel

Symbols mentioned in this story: GDX, GG, ABX, NEM Exchange traded funds (ETFs) trade just ...

FTA, NOV, JBL, ADT: ETF Outflow Alert
Wed, Jul 16, 11:32 AM ET, by ETF Channel

Symbols mentioned in this story: FTA, NOV, JBL, ADT Exchange traded funds (ETFs) trade just ...

Related videos | all videos »
  More articles:  1 2 3 4 5 6 7 next »

ABOUT US »   ADVERTISE »   CONTACT US »   TERMS OF USE & PRIVACY POLICY »

Grail Launches Two Active Bond ETFs | Self Directed Investor | Copyright © 2008 - 2014, All Rights Reserved

Any ideas and opinions presented in Self Directed Investor content are for informational and educational purposes only, and do not reflect the opinions of BNK Invest, Inc. or any of its affiliates, subsidiaries or partners. In no way should any content contained herein be interpreted to represent trading or investment advice. None of the information contained herein constitutes a recommendation that any particular security, portfolio, transaction, or investment strategy is suitable for any specific person. All site visitors agree that under no circumstances will BNK Invest, Inc,. its subsidiaries, partners, officers, employees, affiliates, or agents be held liable for any loss or damage caused by your reliance on information obtained. Read Full Disclaimer.

SDI is associated with: ValueForum.com -- a subscription-based online social networking forum of over 1000 individual investors. | MarketNewsVideo.com -- videos appearing on SDI are produced by Market News Video. | TickerTech.com -- stock quote content appearing on SDI is at least 20 minutes delayed and is powered by Ticker Technologies. | GoldStockStrategist.com -- Edited by Scott V. Nystrom, PhD, Gold Stock Strategist provides analysis on gold mining companies.