The Cheapest NYSE Listed Actively Managed Equity and Fixed Income ETFs of 2023

Cheapest NYSE Listed Actively Managed Fixed Income ETFs

Fixed income stands out as a distinctive segment within the investment landscape where the case for active management grows even more compelling. 

Following the turbulence of the bond bear markets in 2022 and, to some extent, 2023, many investors have come to appreciate the nuances and complexities inherent to this asset class.

The fixed income market, with its opaque nature and occasional liquidity constraints, lends itself well to active oversight.

From a risk-reduction perspective, active management can help navigate the drawdowns that might otherwise trip up passive strategies during a rising rate environment. 

Moreover, in terms of alpha generation – the pursuit of returns above a benchmark – active managers in the bond space have a richer toolkit at their disposal.

Unlike their equity counterparts, bond funds have a plethora of levers they can adjust to respond to market conditions and seize opportunities. 

These include, but aren't limited to, adjusting portfolio duration, fine-tuning credit quality, diversifying across geographies, and even optimizing factors like yield curve positioning and sector allocations. 

Each of these elements, when managed effectively, can significantly enhance returns and provide a degree of protection, offering value in ways that mere bond indices cannot match. 

Here are three of the cheapest NYSE-listed actively managed fixed-income ETFs right now:

• T. Rowe Price QM U.S. Bond ETF (TAGG): 0.08% expense ratio. 
• Franklin U.S. Treasury Bond ETF (FLGV): 0.09% expense ratio. 
• Dimensional Inflation Protected Securities ETF (DFIP): 0.11% expense ratio. 

Cheapest NYSE Listed Actively Managed Equity ETFs

When the conversation turns to actively managed equity, the immediate association many have is with alpha generation – the art and science of selecting stocks either through a proprietary strategy or a rules-based factor approach, all with the aim of outperforming a benchmark. 

However, beyond just stock selection for outperformance, many ETFs under the active management umbrella have distinct goals that cater to specific investor needs. 

Some seek to deliver above-average monthly income, a valuable proposition for those focused on cash flow or in retirement planning stages. Others prioritize limiting downside risk, an endeavor often realized through sophisticated derivative strategies. 

One of the most popular NYSE-listed ETFs that embodies both of these strategies via active stock selection and a covered call overlay is the JPMorgan Equity Premium Income ETF (JEPI), which charges just 0.35% and has attracted some $29 billion in AUM since inception.  

Here are three of the cheapest NYSE-listed actively managed fixed-income ETFs right now:

• Dimensional US Equity ETF (DFUS): 0.11% expense ratio. 
• WisdomTree U.S. Value Fund (WTV): 0.12% expense ratio. 
• Dimensional US Core Equity Market ETF (DFAU): 0.12% expense ratio. 

Please note this article is for information purposes only and does not in any way constitute investment advice. It is essential that you seek advice from a registered financial professional prior to making any investment decision.