IndexIQ has launched the IQ MacKay Shields Municipal Intermediate ETF (MMIT) and the IQ MacKay Shields Municipal Insured ETF (MMIN), the latest additions to the firm’s fast-growing suite of fixed income ETF offerings.
Both funds are actively managed by subadvisor MacKay Municipal Managers of MacKay Shields LLC, an investment team led by co-CIOs John Loffredo and Robert DiMella who collectively have over 50 years of investment experience and have managed municipal strategies together for over 20 years.
MMIT seeks current income exempt from federal income tax. The Fund seeks to achieve its objective by investing primarily in investment grade municipal bonds and will also seek to enhance total return potential through the subadvisor’s active management approach. MMIN seeks current income exempt from federal income tax.
MMIN principally invests in investment-grade municipal bonds covered by an insurance policy guaranteeing the payment of principal and interest, and will also seek to enhance total return potential through the subadvisor’s active management approach. MacKay Municipal Managers Portfolio Manager David Dowden says: “A number of major changes have taken place in the municipal bond category in recent years, introducing new risks and inefficiencies. The benefits of active management in the municipal bond arena are clear when one looks at the dizzying array of credit types available, the substantial number of new issuances entering the market each year, and the dramatically different liquidity environment to be found in the space now. Much of the alpha to be generated in municipal bonds is based on market access and a strong understanding of supply and demand dynamics; all of which we strive to deliver to clients.”
Salvatore Bruno, Chief Investment Officer with IndexIQ says: “These products allow us to bring the municipal bond expertise of MacKay Shields, a fellow New York Life Investment Management boutique, to investors through an innovative, cost-effective ETF chassis. We expect that these new products will allow more investors to gain the benefits of exposure to this complex, yet important, sector of the bond market.”