FMD Capital Management

PIMCO Plays It Safe With Multi-Factor Equity ETFs

Written by David Fabian, November 07th, 2017

PIMCO has long been known as a fixed-income powerhouse with an abundance of investment management talent and enviable track record. They are also one of the most successful purveyors of actively managed exchange-traded funds focused primarily on the bond market to-date.

That dynamic changed recently with the launch of three new multi-factor equity ETFs that successfully complement the existing PIMCO fund lineup. These new funds are backed by a stringent research and stock selection criteria created by Rob Arnott of Research Affiliates, who has a well-respected background in building smart beta portfolios.

Read the complete article at NASDAQ.com

Is A Dividend Cut On The Horizon For DBL?

Written by David Fabian, November 06th, 2017

One of the closed-end funds that seems to be a recurrent favorite on our watch list is the DoubleLine Opportunistic Credit Fund (DBL), run by Jeffrey Gundlach of DoubleLine Capital.  This unique actively managed portfolio was the first of its kind to debut from DoubleLine back in 2012 and has developed a cult following among CEF investors.

DBL primarily invests in a mixed basket of mortgage backed securities, collateralized loan obligations and other asset backed securities.  The fund has just over $325 million in total assets with a relatively tame 16% leverage ratio to boost its net exposure.  It currently yields over 8% annually and income is paid monthly to shareholders.  Read more

Understanding High Beta ETFs

Written by David Fabian, October 31st, 2017

One important dynamic of portfolio construction and risk management is understanding how your stocks fluctuate in relation to the broader market. This factor is often referred to as “beta,” which is essentially the historical volatility of a stock or fund in relation to a benchmark such as the S&P 500 Index.

The higher the measured beta of your holdings, the greater price fluctuations they will have in comparison to the benchmark. A high beta score doesn’t necessarily mean that your investments will outperform on the upside or underperform on the downside. It simply means they have exhibited characteristics of outsized moves or over-reactions in the past.

Read the complete article at NASDAQ.com

Meet The New State Street Portfolio ETFs

Written by David Fabian, October 24th, 2017

The investment management fee wars just escalated to a new level with the announcement that State Street is dropping expenses and re-naming 15 of its diversified exchange-traded funds. This transformed group will be dubbed the “SPDR Portfolio” series and is aimed squarely at the likes of Vanguard, BlackRock, and Charles Schwab in testing the ultimate boundaries of minimalist fund costs.

The new average expense ratio across all 15 SPDR portfolio ETFs is an astounding 0.06%, with several offerings being listed for as low as 0.03%. That’s just $30 per year in embedded expenses for every $100,000 invested and marks a strong advancement for ETF portfolio construction. State Street has also partnered with TD Ameritrade to make these funds commission-free to trade on their brokerage platform, further maximizing the total return of these funds for shareholders.

Read the complete article at NASDAQ.com

How Safe Is Your High Yield ETF?

Written by David Fabian, October 18th, 2017

The strong outperformance of credit-related securities and progressive trend in interest rates has emboldened many investors to bulk up on high yield funds over the course of this bull market.  The minimal dividends from traditional CDs and high-quality Treasury bonds leaves little to be desired when compared to corporate or municipal debt yielding magnitudes of greater income.

The combination of high dividends, consistent capital appreciation, and relatively low volatility have made for an attractive opportunity for many income investors portfolios.

Read the complete article at NASDAQ.com