EGA, TCW team up on duration-defined emerging market fixed income ETFs

Jan 8th, 2014 | By | Category: Fixed Income

Emerging Global Advisors (EGA), the asset manager to the EGShares exchange-traded fund offering, and TCW Group, a global asset management firm, have teamed up to launch three emerging market fixed income ETFs on the NYSE Arca.

EGA, TCW team up on duration-defined emerging market fixed income ETFs

Marten S. Hoekstra, Chief Executive Officer of Emerging Global Advisors.

The ETFs are the industry’s first to provide duration-defined exposure to USD-denominated investment grade emerging market sovereign and corporate bonds.

All three funds are advised by EGA, sub-advised by TCW and track custom indices created and monitored by JP Morgan. They will be managed by Penelope D. Foley and David I. Robbins, group managing directors of emerging markets strategies at TCW.

The funds represent TCW’s first foray into ETFs. As of September 30th, 2013, Los Angeles-headquartered TCW had more than $130 billion assets under management, primarily invested in the fixed income asset class within mutual fund structures.

Marten S. Hoekstra, Chief Executive Officer of Emerging Global Advisors, said: “We identified the lack of duration-defined, emerging market fixed income solutions as an investor need and selected a partner with a proven long-term track record managing emerging market fixed income. Collaborating with TCW allows us to offer investors the ability to implement similar investment strategies in EM fixed income as they do in developed markets.”

David Lippman, Chief Executive Officer of TCW, added: “TCW has always focused on adding value to investors’ portfolios through rigorous analysis and deep asset class expertise. By partnering with EGA, we saw an opportunity to deliver our firm’s unique process and insights in emerging market fixed income to an ETF that allows clients to control for a duration that best matches their individual investment strategy.”

The three funds are as follows:

EGShares TCW EM Short Term Investment Grade Bond ETF (SEMF)
The fund seeks investment results that correspond (before fees and expenses) to the performance of the JP Morgan Custom EM Short Term Investment Grade Bond Index. This index comprises investment grade emerging market sovereign and corporate bonds denominated in US dollars with remaining maturities between one and three years.

EGShares TCW EM Intermediate Term Investment Grade Bond ETF (IEMF)
The fund seeks investment results that correspond (before fees and expenses) to the performance of the JP Morgan Custom EM Intermediate Term Investment Grade Bond Index. This index comprises investment grade emerging market sovereign and corporate bonds denominated in US dollars with remaining maturities between four and seven years.

EGShares TCW EM Long Term Investment Grade Bond ETF (LEMF)
The fund seeks investment results that correspond (before fees and expenses) to the performance of the JP Morgan Custom EM Long Term Investment Grade Bond Index. This index comprises investment grade emerging market sovereign and corporate bonds denominated in US dollars with remaining maturities between eight and twelve years.

Each of the funds comes with an annual fee of 0.65%.

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