The following are some key portfolio product and investment strategy announcements from the prior week of interest to advisors.
1) PIMCO Launches Floating Rate Fund
PIMCO, led by CEO Mohammed El-Erian (left), announced the launch May 4 of the PIMCO Senior Floating Rate Fund (PSRIX), giving investors access to the yields and portfolio diversification offered in the $600 billion senior secured floating rate market.
The fund combines PIMCO’s investment process and global reach with the experience of Portfolio Manager Elizabeth MacLean, formerly of Lord Abbett. PIMCO has managed bank loans, or senior secured floating rate loans typically tied to Libor, since 1996.
2) Fiserv Announces UMH Technology Strategy and Milestones
Fiserv, Inc. announced May 4 its strategy and milestones for the introduction of what it called the industry’s first true unified managed household (UMH) capability.
The first milestone was the June 2010 acquisition of AdviceAmerica, which extended Fiserv's capabilities into front-office applications, such as financial planning, retirement income planning, CRM, proposal-generation and plan-monitoring tools. AdviceAmerica’s solutions are now marketed as Financial Advice Solutions from Fiserv.
The second milestone will move additional managed account programs—mutual fund advisory (MFA) and ETFs—onto the Unified Managed Account (UMA) platform, allowing more functionality in the UMA such as rebalancing across multiple asset classes and systematic contributions and withdrawals.
Later this year Fiserv said it will merge its front-office tools with its middle- and back-office technology, integrating Financial Advice Solutions, Portfolio Management and Trading Solutions and Performance Reporting Solutions onto the company’s Unified Wealth Management platform, where advisors will be able to plan, trade and report on a single system.
3) Invesco PowerShares: Low Volatility/High Beta S&P 500-Based ETFs
Invesco PowerShares announced May 5 that it would list two new ETFs, PowerShares S&P 500 Low Volatility Portfolio (SPLV) and PowerShares S&P 500 High Beta Portfolio (SPHB).
The former, what Invesco calls the first volatility-weighted ETF, seeks investment results that correspond generally to the price and yield of the S&P 500 Low Volatility Index. It will will invest at least 90% of its total assets in common stocks that comprise the underlying index, which consists of the 100 stocks from the S&P 500 Index with the lowest realized volatility over the past 12 months, as determined by Standard & Poor's. Index constituents are rebalanced quarterly.
The latter is the first beta-weighted ETF, and seeks investment results that correspond generally to the price and yield of the S&P 500 High Beta Index. It will invest at least 90% of its assets in common stocks that comprise the underlying index, which consists of the 100 stocks from the S&P 500 Index with the highest sensitivity to market movements, or beta, over the past 12 months, as determined by Standard & Poor's.
4) KMS Financial, Erado Extend Deal on Social Media Compliance
KMS Financial Services, Inc.and electronic communications archiver Erado agreed May 5
on a multiyear extension of existing cloud-based e-mail archiving, and have added social media capturing and compliance servicing in the wake of a period of beta testing over the past year.
5) Goldman Launches Brazil, China Mutual Funds
Goldman Sachs Asset Management, L.P. (GSAM)announced May 3 that it had launched the Goldman Sachs Brazil Equity Fund (GZIAX) and the Goldman Sachs China Equity Fund (GNIAX) on April 29. The portfolios seek to achieve long-term capital appreciation by investing primarily in local Brazilian and Chinese equities.
The funds will be managed by local Goldman Sachs Asset Management International equity teams in Brazil and China, and are offered in A and C shares, both with $1,000 minimum initial investments. Both funds also offer institutional shares.
6) X Launches Food, Fishing ETFs
Global X Fundsannounced that it launched last week the Global X Food ETF (EATX) and the Fishing Industry ETF (FISN).
The Global X Food ETF targets global companies involved in the food industry, which stand to benefit as the population in emerging economies continues to increase their purchasing power. Multinationals like Nestle, one of the world’s largest food producers with a 4.88% weighting in the ETF as of April 29, has 40% of its business in emerging markets and saw underlying sales up 12% in regions such as China, South Asia and Africa.