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   Barclays   Bond   Capital   ETFs   Fund   GMMB   GMTB   Grail   Index   McDonnell   Municipal   PIMCO   about   active   actively   basis   bond   both   charges   discretion   first   fixed   from   fund   funds   have   holdings   including   income   industry   last   launch   launched   launches   line   managed   manager   market   million   muni   must   product   success   that   total   will   with   year

| More

RUSS Crosses Below Key Moving Average Level
Thu, Apr 17, 4:14 PM ET, by ETF Channel

In trading on Thursday, shares of the Daily Russia Bear 3x Shares ETF (RUSS) crossed ...

Red Hat Inc Moves Up In Analyst Rankings, Passing Eastman Chemical Co.
Thu, Apr 17, 11:54 AM ET, by ETF Channel

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

Biotech ETF Experiences Big Outflow
Thu, Apr 17, 10:54 AM ET, by ETF Channel

Symbols mentioned in this story: BBH, REGN, ALKS, ILMN Exchange traded funds (ETFs) trade just ...

XBI, MNKD, UTHR, ARNA: Large Inflows Detected at ETF
Thu, Apr 17, 10:54 AM ET, by ETF Channel

Symbols mentioned in this story: XBI, MNKD, UTHR, ARNA Exchange traded funds (ETFs) trade just ...

XME, ATI, ACI, SLCA: Large Outflows Detected at ETF
Thu, Apr 17, 10:54 AM ET, by ETF Channel

Symbols mentioned in this story: XME, ATI, ACI, SLCA Exchange traded funds (ETFs) trade just ...

RWO, BXP, VNO, AVB: Large Inflows Detected at ETF
Thu, Apr 17, 10:54 AM ET, by ETF Channel

Symbols mentioned in this story: RWO, BXP, VNO, AVB Exchange traded funds (ETFs) trade just ...

CSD, WWAV, PSX, STRZA: Large Outflows Detected at ETF
Thu, Apr 17, 10:54 AM ET, by ETF Channel

Symbols mentioned in this story: CSD, WWAV, PSX, STRZA Exchange traded funds (ETFs) trade just ...

PGX: ETF Inflow Alert
Thu, Apr 17, 10:54 AM ET, by ETF Channel

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

PowerShares KBW Capital Markets Portfolio Breaks Above 200-Day Moving Average - Bullish for KBWC
Wed, Apr 16, 4:15 PM ET, by ETF Channel

In trading on Wednesday, shares of the PowerShares KBW Capital Markets Portfolio ETF (KBWC) crossed ...

Qualcomm, Inc. Moves Up In Analyst Rankings, Passing Monsanto Co.
Wed, Apr 16, 1:14 PM ET, by ETF Channel

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

EEMV: Large Outflows Detected at ETF
Wed, Apr 16, 10:54 AM ET, by ETF Channel

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

ITOT, QCOM, MCD, ABBV: Large Outflows Detected at ETF
Wed, Apr 16, 10:54 AM ET, by ETF Channel

Symbols mentioned in this story: ITOT, QCOM, MCD, ABBV Exchange traded funds (ETFs) trade just ...

HEDJ: ETF Inflow Alert
Wed, Apr 16, 10:54 AM ET, by ETF Channel

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

Chevron Corporation a Top Ranked SAFE Dividend Stock With 3.3% Yield (CVX)
Wed, Apr 16, 8:14 AM ET, by ETF Channel

Chevron Corporation (CVX) has been named to the Dividend Channel ''S.A.F.E. 25'' list, signifying a ...

XTL Crosses Below Key Moving Average Level
Tue, Apr 15, 4:14 PM ET, by ETF Channel

In trading on Tuesday, shares of the SPDR S&P Telecom ETF (XTL) crossed below their ...

PowerShares S&P SmallCap Consumer Discretionary Portfolio (PSCD) Shares Cross Below 200 DMA
Tue, Apr 15, 4:14 PM ET, by ETF Channel

In trading on Tuesday, shares of the PowerShares S&P SmallCap Consumer Discretionary Portfolio ETF (PSCD) ...

PowerShares WilderHill Clean Energy Portfolio Breaks Below 200-Day Moving Average - Notable for PBW
Tue, Apr 15, 4:14 PM ET, by ETF Channel

In trading on Tuesday, shares of the PowerShares WilderHill Clean Energy Portfolio ETF (PBW) crossed ...

IYZ Makes Notable Cross Below Critical Moving Average
Tue, Apr 15, 4:14 PM ET, by ETF Channel

In trading on Tuesday, shares of the iShares U.S. Telecommunications ETF (IYZ) crossed below their ...

ITE Makes Notable Cross Below Critical Moving Average
Tue, Apr 15, 4:14 PM ET, by ETF Channel

In trading on Tuesday, shares of the SPDR Barclays Intermediate Term Treasury ETF (ITE) crossed ...

Time Warner Inc Achieves #87 Analyst Rank, Surpassing Tyson Foods, Inc.
Tue, Apr 15, 12:24 PM ET, by ETF Channel

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

PJP, LLY, DEPO, BAX: ETF Outflow Alert
Tue, Apr 15, 11:24 AM ET, by ETF Channel

Symbols mentioned in this story: PJP, LLY, DEPO, BAX Exchange traded funds (ETFs) trade just ...

DBP Crosses Below Key Moving Average Level
Tue, Apr 15, 11:24 AM ET, by ETF Channel

In trading on Tuesday, shares of the PowerShares DB Precious Metals Fund ETF (DBP) crossed ...

PowerShares Senior Loan Portfolio (BKLN) Enters Oversold Territory
Tue, Apr 15, 11:14 AM ET, by ETF Channel

In trading on Tuesday, shares of the PowerShares Senior Loan Portfolio ETF (BKLN) entered into ...

Shares of XHB Now Oversold
Tue, Apr 15, 11:14 AM ET, by ETF Channel

In trading on Tuesday, shares of the SPDR S&P Homebuilders ETF (XHB) entered into oversold ...

Old Republic International Corp. a Top Ranked SAFE Dividend Stock With 4.6% Yield (ORI)
Tue, Apr 15, 9:24 AM ET, by ETF Channel

Old Republic International Corp. (ORI) has been named to the Dividend Channel ''S.A.F.E. ...

MUAE Crosses Below Key Moving Average Level
Mon, Apr 14, 4:14 PM ET, by ETF Channel

In trading on Monday, shares of the iShares 2016 AMT-Free Muni Term ETF (MUAE) crossed ...

First Trust NYSE Arca Biotechnology Index Fund (FBT) Shares Cross Below 200 DMA
Mon, Apr 14, 4:14 PM ET, by ETF Channel

In trading on Monday, shares of the First Trust NYSE Arca Biotechnology Index Fund ETF ...

VRD Crosses Above Key Moving Average Level
Mon, Apr 14, 4:14 PM ET, by ETF Channel

In trading on Monday, shares of the SPDR Nuveen S&P VRDO Municipal Bond ETF (VRD) ...

iShares U.S. Home Construction Getting Very Oversold
Mon, Apr 14, 3:54 PM ET, by ETF Channel

In trading on Monday, shares of the iShares U.S. Home Construction ETF (ITB) entered into ...

Shares of DWAS Now Oversold
Mon, Apr 14, 3:54 PM ET, by ETF Channel

In trading on Monday, shares of the PowerShares DWA SmallCap Momentum Portfolio ETF (DWAS) entered ...

PSL Crosses Critical Technical Indicator
Mon, Apr 14, 3:54 PM ET, by ETF Channel

In trading on Monday, shares of the PowerShares DWA Consumer Staples Momentum Portfolio ETF (PSL) ...

CUT Crowded With Sellers
Mon, Apr 14, 3:54 PM ET, by ETF Channel

In trading on Monday, shares of the Guggenheim Timber ETF (CUT) entered into oversold territory, ...

Agilent Technologies, Inc. Achieves #7 Analyst Rank, Surpassing Cognizant Technology Solutions Corp.
Mon, Apr 14, 11:54 AM ET, by ETF Channel

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

See How Procter & Gamble Co. Ranks Among Analysts' Top Dow 30 Picks
Mon, Apr 14, 11:54 AM ET, by ETF Channel

A study of analyst recommendations at the major brokerages shows that Procter & Gamble Co. ...

EDC: Large Inflows Detected at ETF
Mon, Apr 14, 11:14 AM ET, by ETF Channel

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

KBE, BPOP, VLY, CFR: ETF Outflow Alert
Mon, Apr 14, 10:54 AM ET, by ETF Channel

Symbols mentioned in this story: KBE, BPOP, VLY, CFR Exchange traded funds (ETFs) trade just ...

XOP, SGY, CRK, PVA: Large Outflows Detected at ETF
Mon, Apr 14, 10:54 AM ET, by ETF Channel

Symbols mentioned in this story: XOP, SGY, CRK, PVA Exchange traded funds (ETFs) trade just ...

T Named Top 25 SAFE Dividend Stock Increasing Payments For Decades
Mon, Apr 14, 8:14 AM ET, by ETF Channel

AT&T Inc (T) has been named to the Dividend Channel ''S.A.F.E. 25'' list, signifying a ...

RCD Makes Notable Cross Below Critical Moving Average
Fri, Apr 11, 4:14 PM ET, by ETF Channel

In trading on Friday, shares of the Guggenheim S&P 500 Equal Weight Consumer Discretionary ETF ...

RFG Crosses Below Key Moving Average Level
Fri, Apr 11, 4:14 PM ET, by ETF Channel

In trading on Friday, shares of the Guggenheim S&P MidCap 400 Pure Growth ETF (RFG) ...

Biotech Getting Very Oversold
Fri, Apr 11, 4:14 PM ET, by ETF Channel

In trading on Friday, shares of the Biotech ETF (BBH) entered into oversold territory, changing ...

Monster Beverage Corp Moves Up In Analyst Rankings, Passing Sempra Energy
Fri, Apr 11, 12:14 PM ET, by ETF Channel

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

RTH Makes Notable Cross Below Critical Moving Average
Fri, Apr 11, 11:14 AM ET, by ETF Channel

In trading on Friday, shares of the Retail ETF (RTH) crossed below their 200 day ...

KCE Makes Notable Cross Below Critical Moving Average
Fri, Apr 11, 11:14 AM ET, by ETF Channel

In trading on Friday, shares of the SPDR S&P Capital Markets ETF (KCE) crossed below ...

PEJ Crosses Below Key Moving Average Level
Fri, Apr 11, 11:14 AM ET, by ETF Channel

In trading on Friday, shares of the PowerShares Dynamic Leisure and Entertainment Portfolio ETF (PEJ) ...

PowerShares KBW High Dividend Yield Financial Portfolio Breaks Below 200-Day Moving Average - Notable for KBWD
Fri, Apr 11, 11:14 AM ET, by ETF Channel

In trading on Friday, shares of the PowerShares KBW High Dividend Yield Financial Portfolio ETF ...

GURU Makes Notable Cross Below Critical Moving Average
Fri, Apr 11, 11:14 AM ET, by ETF Channel

In trading on Friday, shares of the Guru Index ETF (GURU) crossed below their 200 ...

Consumer Discretionary Select Sector SPDR Fund (XLY) Shares Cross Below 200 DMA
Fri, Apr 11, 11:14 AM ET, by ETF Channel

In trading on Friday, shares of the Consumer Discretionary Select Sector SPDR Fund ETF (XLY) ...

iShares U.S. Insurance Breaks Below 200-Day Moving Average - Notable for IAK
Fri, Apr 11, 11:14 AM ET, by ETF Channel

In trading on Friday, shares of the iShares U.S. Insurance ETF (IAK) crossed below their ...

VO, FRX, WDC, CERN: Large Inflows Detected at ETF
Fri, Apr 11, 10:54 AM ET, by ETF Channel

Symbols mentioned in this story: VO, FRX, WDC, CERN 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.