This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Pimco Breaks Ground on Active ETFs

Pacific Investment Management (PIMCO) has announced its plan to launch five actively managed ETFs to compete with rivals like State Street (STT) and PowerShares.

So far, the actively managed ETF space has been all talk and no game. While compelling arguments exist as to why these funds should be such a roaring success, this is new and uncertain territory for the industry. The role of ETFs is changing, and the fund companies are now testing already-claimed territory.

The seedlings of the ETF industry grew in and around the massive roots of mutual fund giants. The nimble new products could do things that their mutual fund peers could not: offer transparency, tax advantages and liquidity through major exchanges. ETF patches also gained strength in the sunlight not stolen by the massive trees above -- areas of the market like commodities that were previously not accessible through mutual funds.

This small forest carpet, however, is beginning to grow strength, and more robust strains of the ETF flora may begin to sap energy from the host. In the past decade, the ETF industry has surged 10-fold to more than $500 billion. ETFs like S&P 500 Depository Receipts (SPY) and Financial Sector Select SPDR (XLF) see millions of shares trade hands per day. As they eye any and all profitable portions of the market, the big names now want a piece of the action.

While retail investors were early adopters of ETFs and institutional investors continued to embrace mutual funds (or separate account management), the line has begun to become blurred. In a recent article in Trader, Knight Equity Markets, a giant market-maker, copped to seeing a "tidal wave of volume and liquidity in the ETF space." What makes this influx of volume different, however, is that it represents "the rise of a new ETF customer base: traditional asset managers."

1 of 2

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs