Wells Fargo is preparing to enter the ETF business.
The bank has filed registration notices with the Securities and Exchange Commission for the Wells Fargo Exchange-Traded Funds Trust and for an Ultra Short Duration Income ETF, which will presumably be the trust’s first offering.
The short duration income ETF would invest in a variety of securities including government and corporate debt, municipal and mortgage-backed securities, commercial paper, repurchase agreements, CDs and more and have an effective duration of one year or less. It would focus on investment-grade debt and would “normally invest” at least 25% of assets in securities banking industry debt.
The ETF appears to be an actively managed fund given the discussion of investment risks in the filing, although active management is not mentioned directly.
“This filing is consistent with WFAM’s focus on expanding and enhancing our product lineup to best meet the investment needs of our clients,” according to a spokeswoman’s statement, referring to Wells Fargo Asset Management.
Dave Nadig, chief investment officer and director of research for ETF Trends, tweeted that it was “weird to have Wells go from being literally one of the very very first index shops to one of the very very last to get into ETFs.”