A Slow and Steady Bond Investment for Careful Investors

Doug Fabian

Doug Fabian is known for his expert knowledge of ETFs, bear funds and enhanced index funds to profit in any market climate.

This week’s ETF Talk marks the beginning of a new series on what I see as the best growth and income funds for prospective investors to pay attention to as we enter 2016. These investments seem to me to have strong prospects going forward. First we will discuss one of my favorite income-oriented exchange-traded funds (ETFs), SPDR DoubleLine Total Return Tactical ETF (TOTL).

View the current price, volume, performance and top 10 holdings of TOTL at ETFU.com.

This fund uses bonds and fixed income securities to generate yield for its investors at a relatively stable price. Most of its holdings are Treasury bonds and mortgage-backed securities, with some dabbling in emerging markets, corporate debt and more. This fund is quite new, as its date of inception was February of this year.

Considering the types of assets in which it invests, it should come as no surprise that this fund’s price is steadier than most. However, likely in part due to the current interest rate environment, it has declined 2.56% in terms of nominal price since its inception, roughly balancing out its dividend payments. Its expense ratio is 0.15%, and the fund’s yield currently adds up to about 4.3% annually. Despite its recent creation, it already holds more than $1.6 billion in assets.

totl

TOTL is made up of a number of different security types. By far the largest component is mortgage-backed securities, weighing in at 58.53%. Treasury bonds make up 8.82% of the portfolio. This is followed by emerging market-based securities, commercial mortgage-backed securities and investment-grade corporate debt.

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If you’re looking for a stable bond fund to add to your portfolio, SPDR DoubleLine Total Return Tactical ETF (TOTL) could provide the payouts you seek.

I’ll be back next week with another income fund for your consideration.

Remember to look for the current price, volume, performance and top 10 holdings of TOTL at ETFU.com.

If you want my advice about buying and selling specific ETFs, including appropriate exit points, please consider subscribing to my Successful ETF Investing newsletter.

As always, I am happy to answer any of your questions about ETFs, so do not hesitate to send me an e-mail. You just may see your question answered in a future ETF Talk.

In case you missed it, I encourage you to read my e-letter column from last week about a utilities ETF. I also invite you to comment in the space provided below.

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Investing trend expert Chris Versace discusses why fund managers engage in "window dressing" and how it affects market conditions.

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