Janus Capital to launch actively managed short duration income ETF

Aug 4th, 2016 | By | Category: Fixed Income

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Global investment firm Janus Capital Group has filed a registration statement with the Securities and Exchange Commission to launch an actively managed fixed income exchange-traded fund. The move follows a new ruling from the SEC that will reduce the time taken between initial filings and launch on certain actively managed ETFs.

Janus Capital roll out four thematic ETFs on Nasdaq

Nick Cherney, Senior Vice President and Head of Exchange Traded Products for Janus Capital Group.

The Janus Short Duration Income ETF (NYSE:VNLA) will form part of the provider’s fixed income offering and is the first time it has offered an actively managed ETF since its acquisition of Velocity Shares in 2014. The ETF is intended to provide investors with a steady income stream and capital preservation across various market cycles. The aim is to deliver returns 2-3% above the 3-month LIBOR rate, through various market cycles with low volatility.

Kumar Palghat and Nick Maroutsos will be co-lead portfolio managers of the ETF. Palghat said: “The key is to capitalize on structural inefficiencies in fixed-income markets… By actively looking for value across sectors and geographies using a wide range of fixed-income instruments, we believe we will be better positioned to outperform through market cycles.”

Nick Cherney, Senior Vice President and Head of Exchange Traded Products for Janus Capital Group , added: “Advisors have embraced actively managed fixed-income ETFs as they look for expert management to navigate low cash returns and potentially rising rates, while still enjoying the structural benefits of ETFs.”

Actively managed ETFs are growing in popularity with assets under management hitting a record high of $38.2bn at the end of June, according to data from ETFGI.  The milestone was reached on the back of strong inflows to fixed income actively managed ETFs with the sector gathering $296m in June.

Janus’ ETF strategy is based on offering differentiated products in categories including tactical, enhanced beta and active ETFs.

In June it launched four thematic ETFs based on companies whose businesses are involved in care for the elderly, health & fitness provisions, obesity treatments, and supplying organic consumer products. The Janus LongTerm Care ETF (NASDAQ: OLD), Janus Health and Fitness ETF (NASDAQ: FITS), Janus Obesity ETF (NASDAQ: SLIM), and the Organics ETF (NASDAQ: ORG) all have a total expense ratio of 0.50%.

It is unclear what the new ETF will cost, but assuming all approvals are granted, it is expected to launch in or around October 2016. The ETF is likely to compete with the PIMCO Enhanced Short Maturity Active ETF (MINT), which has seen total returns of 0.99 year-to-date. It has a TER of 0.36%.

As of June Janus had total ETP assets of $3.8bn.

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