Fidelity Investments launched the Fidelity Municipal Income 2025 Fund – an addition to Fidelity’s Defined Maturity Funds (DMF) lineup that seeks to bridge the gap between individual bonds and bond funds.
“With aging demographics, the need for income-specific investment solutions among U.S. investors will only continue to grow,” said Nancy Prior, president of Fidelity’s Fixed Income division, in a statement. “Extending the lineup will maintain a range of target maturities for investors managing varying income needs.”
The Fidelity DMFs provide an investment option to investors interested in tax-exempt income over defined periods of time.
As the Fidelity Municipal Income 2017 Fund nears its maturity date, Fidelity Municipal Income 2025 Fund will be added to the existing series of DMFs with current maturity years of 2017, 2019, 2021, and 2023.
Fidelity Municipal Income 2025 seeks as high a level of current income, exempt from federal income tax, as is consistent with the preservation of capital by normally investing at least 80% of assets in investment-grade municipal securities whose interest is exempt from federal income tax.
Fidelity will actively manage the fund to take advantage of opportunities to add value through professional management, credit analysis, diversification and risk management. The duration, however, will be tightly constrained to the stated target maturity date. Similar to Fidelity’s other DMF funds in the lineup, Fidelity Municipal Income 2025 will be managed by Fidelity’s municipal bond team.
“The DMF funds may be appropriate for income-seeking investors who are interested in combining the defined-maturity feature of individual bonds with the many features of bond funds, including diversification and professional management, thus removing much of the legwork of individual bond investing,” Prior said in a statement.
The new fund is available directly to investors, as well as through advisors at banks, insurance companies and broker-dealers via Fidelity Advisor Funds classes A and Institutional. The retail class is sold without a load and has a total expense ratio of 0.40%.
The Advisor share classes have a total expense ratio of 0.65% for Class A and 0.40% for the Institutional Class. The minimum investment will be $10,000 for retail and Advisor share classes.
Gurtin Launches Sustainable Municipal Investment Strategy
Gurtin Municipal Bond Management launched a Municipal Social Advancement strategy – adding to Gurtin’s existing suite of sustainable municipal bond strategies. This strategy enables customization of separately managed municipal bond portfolios that align investors’ values with their investments.
The Municipal Social Advancement strategy is designed as a solution for investors who wish to pursue competitive financial returns while supporting positive social and environmental outcomes. These separately managed portfolios can be tailored to focus municipal investments in one, or a combination of all three, of the following areas: education, environment and U.S. infrastructure.
Additionally, investors can choose to have their Municipal Social Advancement portfolios structured as California-specific or national, with a short-, limited-, or intermediate-term duration.
Gurtin’s fundamental analysis weighs credit metrics across various environmental, social, and governance (ESG) categories, with bonds considered for purchase for Municipal Social Advancement portfolios additionally undergoing negative and positive screenings to focus investment in municipal bonds that are high quality, sustainable, and issued for a purpose that supports targeted social and economic goals.
ActiveShare.info Now Includes Equity Fund Data through Year-End 2016
ActiveShare.info has been updated, and now contains data measuring active management and fees for U.S. equity funds through year-end 2016.
ActiveShare.info is a free web resource that helps advisors and investors identify true active management and better understand its costs as part of their due diligence efforts.
While high Active Share doesn’t guarantee outperformance, empirical evidence from earlier academic studies showed that having a higher Active Share improves a fund’s opportunity to beat its benchmark. Low Active Share funds have, historically, substantially underperformed their benchmarks.
There is no charge to use the site. Using the fund name or ticker, site visitors can use ActiveShare.info to get the following information: current and historical Active Share data, the fund’s holdings duration, and the fund’s “active fee,” which rescales a fund’s expenses for its active portion, so that investors can consider the manager’s hurdle rate to earn back the fees through the portfolio’s active component alone.
Bats ETF Implied Liquidity Feed Now Available on Money.Net
The Bats ETF Implied Liquidity Feed is now available for use on Money.Net platforms, its first platform distribution partner.
The Bats ETF Implied Liquidity Feed measures the implied liquidity of a fund using select data points, which includes information regarding the ETF’s underlying securities. The feed is designed for all investors looking to obtain an accurate and indicative representation of the value of an ETF intraday, distinct from other common metrics, like average daily volume or Net Asset Value.
The information provided by the feed has a range of uses throughout the ETF trading lifecycle. Pre-trade, the feed allows investors to understand the true liquidity picture when selecting investable ETFs, and better estimate trading costs before placing orders. During trading, the feed will allow investors to adjust limits to enhance the probability of orders being filled, and evaluate block-trading proposals in real-time, knowing where to trade in size.
Post trade, investors can use the feed as a reference to measure trades against historical implied quotes and size. In analyzing the data, investors can optimize their approach to trade at liquidity peaks.
—Read last week’s portfolio roundup here: Putnam Investments to Launch 3 Alternative Strategies: Portfolio Products