Tag Archives: jeff gundlach

Why Mutual Fund Guru Gundlach Is Now Embracing ETFs: A $TOTL $uccess

MarketsMuse.com ETF update profiles the embracement of exchange-traded funds on the part of one of the investment industry’s most intriguing mutual fund innovators, courtesy of excerpt from 18 April 19 story from InvestmentNews.com

Jeffrey Gundlach is no stranger to striking out on his own or launching new products. After an acrimonious split with the TCW Group Inc. in 2009, he did just that, building what has become a $63 billion business with 12 mutual funds.

But when it came to starting an exchange-traded fund, his Los Angeles-based firm, DoubleLine Capital, needed some convincing, according to David LaValle, head of ETF capital markets in the U.S. at State Street Corp.’s money management unit.

“Why would they want to be in this space when [they] have a successful franchise,” said Mr. LaValle, speaking at an industry conference in New York on April 1. Ultimately, though, ETFs access “a totally different investor base” than mutual funds, Mr. LaValle said.

Mr. Gundlach has said he remains ambivalent about just how popular ETFs will become. But, on the sidelines of a massive ETF industry conference he keynoted in Hollywood, Fla., in January, he said he wasn’t going to take any chances. “I want to be involved, certainly, and not left behind,” he told a reporter.

In little more than a month since the launch of his first actively managed ETF, in partnership with State Street, the SPDR DoubleLine Total Return Tactical ETF (TOTL) has become one of the largest ETFs of its kind. At $240 million, TOTL’s assets are still a pittance compared with the $117 billion in the world’s largest bond mutual fund, Pimco Total Return (PTTAX).

For the entire story from InvestmentNews.com, please click here

A Dearth of Investment Grade Debt: Why Rates Stay Lower for Longer

While a certain sect of economists are lamenting the exponential increase in debt issued by an assortment of sovereign entities [and corporate bond issuers] within the context of a feared liquidity crisis if and when rates turn higher and institutional investors might run for the exits at the same time, MarketsMuse.com fixed income fix profiles global macro observations from Barry Ritholtz, the Bloomberg View columnist who writes about finance, the economy and the business world. Barry started the Big Picture blog in 2003 and is the founder of Ritholtz Wealth Management, an asset management and financial planning firm. Below is excerpt from Barry’s Mar 17 Bloomberg View article”The Worldwide Deficit of High-Quality Debt

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Bond Guru Gundlach Launches Actively-Traded Bond ETF

MarketsMuse update profiling the debut of bond guru and DoubleLine Capital’s founder Jeff Gundlach’s first foray into the ETF space is courtesy of ETF.com.The SPDR DoubleLine Total Return Tactical ETF (TOTL) is launching today (Tuesday, Feb. 24).

The $TOTL exchange-traded fund invests in just about every type of debt security, including investment-grade and junk debt—both sovereign and corporate—from issuers around the globe. The portfolio management team is led by none other than Gundlach himself, and will be advised by State Street, according to the prospectus. TOTL costs a net of 55 basis points in expense ratio, or $55 per $10,000 invested.

Gundlach, founder of Los Angeles-based DoubleLine Capital, is one of the most well-known fixed-income investors in the market today, but until now an absent presence in the quickly growing ETF market.

Partnership With SSgA

Last summer, he joined forces with State Street Global Advisors to bring to market an actively managed bond ETF that would go head-to-head with the Pimco Total Return ETF (BOND | B), which at the time was still managed by Bill Gross. Gross has since left Pimco to join Janus.

Replicating BOND’s success will be no small feat, considering that BOND gathered its first $1 billion in assets in less than three months after launch, and grew to become one of the biggest active bond ETFs in the market. BOND’s success was part Gross himself, part a solid track record of outperformance. TOTL has a powerhouse name behind it, but performance only time will tell.  Continue reading

LIVE FROM ETF.com Conference: Expert Bashes ETFMs

Markets Muse senior staff dumped their snow boots and instead, has boots on the ground at the Florida ETF boondoggle hosted by ETF.com. One of the more reportable take-aways (so far) is our capturing the following comment about the much talked about new product trend focused on non-transparent, hedge fund-esque ETFs,  courtesy of one industry expert (who chooses not to be cited for fear of having to check under his car every day before starting the engine):

“Actively-Managed ETFs aka ETMFs will only benefit ‘Issuers’ and respective ‘managers’ who promote HF-style styles under the guise of a so-called “index.” At best, this is a marketing ploy to capture AUM and fees for a product that is completely counter-intuitive to the premise that made ETFs attractive in the first place (transparency and hence liquidity). Hedge Funds such as those managed by the Jeff Gundlach’s of the world charge “2 & 20” but can only target a relatively small universe of investors. With the assortment of ETMFs on the drawing board, the only thing that is clear and transparent is that these ‘ETMF innovators’ are merely trying to ‘scale’ their secret-sauce models by targeting millions of less-sophisticated investors (via a 50% reduction in typical management fees) and folks who would otherwise not pass the institutional investor litmus test (QUIB) for a typical hedge fund that changes its positions more frequently than most folks change their underwear.”