John Hancock Expands Fixed Income ETF Suite with Core and Core Plus Bond ETFs

John Hancock Investment Management (JHIM) has bolstered its active fixed income ETF suite with the launch of John Hancock Core Bond ETF (JHCB) and John Hancock Core Plus Bond ETF (JHCP). These new offerings cater to investors seeking actively managed exposure to the fixed income market, providing additional options for portfolio diversification.

The Core and Core Plus Bond ETFs offer unique features that set them apart from other fixed income ETFs. Both ETFs are actively managed, allowing their portfolio managers to adapt to changing market conditions and capitalize on opportunities. The Core Bond ETF focuses on investment-grade bonds, aiming to provide a stable income stream and capital preservation. The Core Plus Bond ETF, on the other hand, expands the investment universe to include high-yield bonds, offering additional yield potential while maintaining a focus on risk management.

These ETFs benefit from the expertise of Manulife Investment Management, which subadvises these funds. This ensures a disciplined and research-driven approach to portfolio construction, further enhancing their appeal to investors.

In terms of management fees and expense ratios, the Core Bond ETF (JHCB) has an expense ratio of 0.15%, while the Core Plus Bond ETF (JHCP) has an expense ratio of 0.20%. These fees are lower than the average expense ratio of 0.25% for actively managed fixed income ETFs, according to data from Morningstar. Additionally, both ETFs have management fees that are lower than the average management fee of 0.40% for actively managed fixed income funds. This makes John Hancock's Core and Core Plus Bond ETFs an attractive option for investors seeking actively managed fixed income exposure at a competitive cost.

The Core and Core Plus Bond ETFs differ in their investment strategies and risk profiles. JHCB aims to provide broad exposure to the U.S. investment-grade bond market, focusing on high-quality securities with a duration of 3-10 years. Its investment objective is to seek a high level of current income while preserving capital. The fund invests at least 80% of its net assets in investment-grade bonds, with a maximum of 20% in high-yield bonds. JHCB's risk profile is relatively conservative, targeting a lower level of volatility compared to JHCP.

JHCP, on the other hand, offers a more diversified approach by investing in a mix of investment-grade and high-yield bonds, with a duration of 3-15 years. Its investment objective is to seek a high level of current income with long-term capital appreciation. The fund allocates at least 50% of its net assets to investment-grade bonds and up to 50% in high-yield bonds. JHCP's risk profile is more aggressive than JHCB, with a higher potential for volatility and capital appreciation.

In conclusion, John Hancock Investment Management's expansion of its active fixed income ETF suite with the launch of John Hancock Core Bond ETF (JHCB) and John Hancock Core Plus Bond ETF (JHCP) offers investors additional tools for portfolio diversification. These ETFs, subadvised by Manulife Investment Management, aim to provide broad exposure to the U.S. investment-grade bond market, with JHCB focusing on core bonds and JHCP including a 10% allocation to high-yield bonds. By complementing existing offerings like the John Hancock International High Dividend ETF (JHID), these ETFs allow investors to access diverse income streams and manage interest rate risk. The active management approach enables the portfolio managers to navigate market conditions and adapt to changing economic environments, further enhancing the value of these ETFs in a diversified portfolio.