Bringing you live news and features since 2006 

First Trust launches First Trust Low Duration Strategic Focus ETF


First Trust Advisors has launched a new actively-managed exchange traded fund, the First Trust Low Duration Strategic Focus ETF.

The fund seeks to generate current income, with a secondary objective of preservation of capital by allocating primarily among First Trust ETFs, but may also include other ETFs representing various asset classes, aimed at providing diversification benefits and less interest rate sensitivity when compared to traditional core fixed income benchmarks over time.
The fund is managed by First Trust Advisors, with selection and portfolio decisions made by an Investment Committee, using an investment process that combines bottom-up fundamental credit analysis with disciplined portfolio construction. The process begins with a robust, top-down review of macroeconomic factors including monetary and fiscal policies, growth forecasts, trade and tax policies, global market views and current market valuations. The process combines these factors with disciplined bottom-up asset level analysis including views on rates, duration, credit, currency and current asset valuations.
The relative attractiveness of the various fixed income asset classes is also evaluated in an attempt to best position the fund to take advantage of market trends and investment opportunities. The Investment Committee seeks to construct a portfolio with a target duration of three years or less, while managing both interest rate risk and credit risk. Duration is a mathematical calculation of the average life of a debt security (or a portfolio of debt securities) that serves as a measure of its price risk. The fund focuses on lower duration securities as they have historically held up better in rising interest rate environments than those with longer durations. “At this point in the cycle, we believe risk management is critical for fixed income investors. This ETF harnesses the best of First Trust’s intellectual capital to provide investment advisors with an efficient tool to help manage their clients’ fixed income needs,” said Ryan Issakainen, CFA, Senior Vice President, ETF Strategist at First Trust.
The First Trust Advisors Investment Committee manages the portfolio by leveraging the knowledge of First Trust’s research teams and portfolio management teams who understand the unique factors that drive risk adjusted returns within various asset classes. They believe a successful investment process involves a disciplined and theory-driven framework to guide the building blocks of the portfolio’s allocation.

Latest News

US ETF issuers of active ETFs are facing an increase in fees from the big custodian firms, such as Charles..
ETF data consultant ETFGI reports that assets invested in the global ETF industry reached a new record of USD12.71 trillion..
Calastone has published an ETF white paper which examines several of the processes that take place across the lifecycle of..
Adapting product lines to fit into changing methodologies and meet shifting demand is essential to remaining relevant in the industry..

Related Articles

Taylor Krystkowiak, Themes ETFs
Themes ETFs opened its doors in December 2023, with an introductory suite of 11 ETFs – seven thematic and four...
Konrad Sippel, Solactive
At the end of March, financial index specialist, Solactive, published its 2024 annual report on future trends.  ...
Lorraine Sereyjol-Garros, BNP Paribas
Following changes to the French Monetary and Financial Code and of the French market authority AMF’s General Regulation, it is...
Ed Rosenberg, Texas Capital
Texas Capital Bank first opened its doors back in December 1998 and nowadays offers wealth-management services, as well as commercial,...
Subscribe to the ETF Express newsletter

Subscribe for access to our weekly newsletter, newsletter archive, updates on the site and exclusive email content.

Marketing by