State Street Global Advisors (SSGA) has launched the first actively managed corporate and municipal target maturity bond ETFs in the US market.
Named SPDR SSGA MyIncome ETFs, the suite looks to offer investors the ability to build their own custom bond ladder portfolios to manage their respective cash flow, interest rate risk, and liquidity needs.
The suite consists of 14 actively managed target maturity ETFs with various maturity years ranging from 2026 to 2034.
“Fixed income investors have been enjoying the highest interest rates seen in decades, but many are wondering how they can protect against the potential for precarious rate fluctuations ahead,” said Anna Paglia, chief business officer at SSGA.
The SPDR SSGA MyIncome ETFs are designed to help investors build custom bond ladder portfolios to manage interest rate risks, cash flows, and liquidity needs. The suite is made up of both corporate bond and municipal bond ETFs.
The nine corporate bond ETFs aim to maximise current income while seeking preservation of capital, while the five municipal bond ETFs look to maximise current income that is exempt from regular federal income taxes while seeking preservation of capital.
“Investors are looking for ways to balance income and stability in this rate environment, and building a bond ladder portfolio through investing in ETFs may be an efficient way to manage duration risk and cash flow to meet liquidity needs,” said SSGA.
The investment strategies of these new ETFs are designed to enable portfolio management teams to maximise yield while preserving capital through robust investment processes and risk management.
SSGA added that its active approach seeks to enhance the income profile of a target maturity ETF portfolio, while also managing for liquidity, sector, issuer concentration, and broader macro risks.
SSGA’s dedicated active fixed income portfolio management team will manage the funds.