Janus is Working on a Bill Gross Bond ETF

After bringing on bond guru Bill Gross to run its Global Unconstrained Bond Fund, Janus Capital Group is now working on an exchange traded fund adaptation.

According to a preliminary Securities and Exchange Commission filing, the regulator is looking over an application for the Janus ETF Trust under the Investment Company Act of 1940 for an actively managed series.

While it is not a forgone conclusion that the company will act on the filing if the SEC grants a final approval, Janus chief executive Richard M. Weil has hinted on his desire to bring Gross’ management style out with an ETF, reports Trevor Hunnicutt for InvestmentNews.

A proposed Janus ETF could act very similarly to the Janus Global Unconstrained Bond Fund (JUCAX). However, unlike the mutual fund version, the ETF would disclose its positions on a daily basis.

“On each Business Day, before commencement of trading in Shares on a Fund’s Listing Market, the Fund will disclose on the Website the identities and quantities of the Portfolio Positions and other assets held by the Fund, or its respective Master Fund, that will form the basis for the Fund’s calculation of NAV per Share at the end of the Business Day,” according to a SEC filing.

The ETF would invest in government notes and bonds, corporate bonds, convertible bonds, commercial and residential mortgage-backed securities, asset-backed securities, zero-coupon bonds, and derivatives that provide exposure to bonds.

Additionally, the advisor would seek long-term positive returns by managing portfolio duration, credit risk and volatility through various debt qualities and include long, short or negative duration. The fund could hold high-yield/high-risk, junk bonds, along with other securities that pay dividends.

Bill Gross previously helped manage the PIMCO Total Return ETF (BOND) , an ETF version of PIMCO’s flagship Total Return Fund (PTTRX). In late September, Gross left Pacific Investment Management Co. and joined Janus Capital Group Inc.

In Gross’ monthly investment outlook, he warned of the potential negative concsequences in the current sub-zero yield environment. Specifically, the loose global monetary policies may help in the short-term, but Gross argues that the negative or zero bound interest rates may exacerbate low growth by pushing people to save and defer consumption. Consequently, he believes investors should stay conservative and own high quality bonds and low P/E, high quality stocks.

For more information on the fixed-income market, visit our bond ETFs category.

Max Chen contributed to this article.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.