Capital Group, an active manager known for its American Funds mutual fund family, plans to offer three new active, transparent fixed-income exchange-traded funds this fall following the February launch of its first six ETFs, which now boast about $2 billion in total assets.
Los Angeles-based Capital Group plans to offer the Capital Group Municipal Income ETF, Capital Group U.S. Multi-Sector Income ETF and Capital Group Short Duration Income ETF, a filing with the Securities and Exchange Commission last July 14 showed. Only one of the previous six ETFs was a fixed-income offering.
"It's been a success story for them," said Todd Rosenbluth, head of research at VettaFi LLC, a data and analytics provider, regarding Capital Group's entry into the ETF market, adding that given the wide range of mutual fund strategies offered through its American Funds family, he expects to see additional filings for new ETFs from Capital Group.
Instead of dipping its toe into the ETF market, Capital Group is "diving in," Mr. Rosenbluth said. And, though a latecomer to the ETF space, it has entered the market at time when actively managed ETFs "are an emerging trend," he said.
"We've only more recently seen the success of some active managers building a following," Mr. Rosenbluth said.
Capital Group has no current plans to file for any additional new ETFs this year, a company spokeswoman said. It expects to launch the three new fixed-income ETFs by early November, she said.
All of Capital Group's ETFs, including the three new fixed-income funds it plans to launch, are designed to "sit at the core of a portfolio," the spokeswoman said.
"Historically, ETFs have been mostly passive, meaning that the core building blocks needed for a suite of ETFs designed to weather volatility and provide excess returns over the long term has not been readily available," she said.
The spokeswoman added that the "fixed-income allocations where these three new ETFs fit are some of the most used and asked for by clients."
Capital Group had about $2.5 trillion in assets under management as of March 31, the spokeswoman said.
