Actively Managed Strategy That Invests in Short-Duration Securities
NASDAQ OMX today announced that First Trust will launch a new exchange traded fund (ETF), First Trust Enhanced Short Maturity ETF (Symbol: FTSM), which will be listed on The NASDAQ Stock Market® (NASDAQ®). FTSM will begin trading on NASDAQ on Wednesday, August 6, 2014.
"Over the past few years, in this low interest rate environment, investors in short-term bonds have often been faced with a choice between losing purchasing power safely in high quality bonds with negative real returns, or seeking higher returns from securities that are below investment-grade," said Ryan Issakainen, Senior Vices President and ETF Strategist at First Trust. "The idea behind this actively managed ETF is to provide a middle ground by investing in a diversified portfolio of primarily investment-grade, short-duration securities that may offer a higher level of income, while still focusing on capital preservation and daily liquidity."
FTSM is an actively managed ETF that seeks to provide current income, consistent with preservation of capital and daily liquidity. FTSM uses an actively managed strategy that invests in short-duration securities, which are primarily U.S. dollar denominated, investment-grade securities. The fund will be invested across a broad range of asset classes to maintain diversification and at least 80% of the fund's assets will be investment-grade securities. FTSM seeks to achieve its objectives by strategically laddering highly liquid investments over the near-term horizon. As market conditions change, the portfolio managers have the flexibility to strategically rotate among various market sectors while maintaining a focus on preservation of capital and liquidity.
"We are thrilled to list another innovative First Trust exchange traded product on NASDAQ," said Dave LaValle, Head of Exchange Traded Product Listings at NASDAQ OMX. "We value our position as First Trust's listing venue partner for the First Trust Enhanced Short Maturity ETF and will continue to support First Trust as they expand their robust product offering."
NASDAQ OMX operates an efficient platform for successfully introducing a product suite into one of the single largest pools of liquidity, including market participants which represent a full spectrum of investors. ETF issuers benefit from an end-to-end solution that provides ongoing product support including index licensing, listings opportunities, data offerings and trading services. As the home to some of the world's most innovative ventures, NASDAQ OMX generates opportunities for issuers to access new markets and deliver new concepts that change the way the industry develops, manages and applies ETFs.