Jeffrey Gundlach's Latest ETF Aims To Leverage Rising Rate Environment

DoubleLine has introduced the DoubleLine Asset-Backed Securities ETF DABS, an actively managed fund targeting long-term total return and current income. The fund, which launched on Tuesday, has a net expense ratio of 39 basis points and primarily invests in investment-grade asset-backed securities (ABS), though it may also hold unrated or high-yield fixed-income securities.

DABS invests in various ABS, including collateralized debt obligations and bond obligations. The fund's active management approach aims to adjust portfolio duration, expected to range between one and six years, to mitigate interest rate risk.

DoubleLine's ABS team manages $4.7 billion across multi-sector portfolios.

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Expanding ETF Offerings

DABS is DoubleLine's eighth ETF in the U.S., contributing to a fund suite managing over $1.3 billion in assets, noted etftrends.com.

The launch comes at a time when DoubleLine CEO and Chief Investment Officer Jeffrey Gundlach has pointed to a significant shift in the economic and financial scenario. "The economy and financial markets have entered a new secular environment that challenges previous wisdom on items such as traditional recession indicators," he said in January.

Gundlach highlighted a transition from "secular declining interest rates" to "secular rising interest rates, at least on the long end." He noted that "some of the traditional recession indicators don’t work, haven’t been working because they’ve worked during a different secular regime."

More broadly, Gundlach has spoken about structural shifts in the economy, describing what he calls the "fourth turning," a period of societal upheaval. "I feel like we're leaving the bus right here in the fourth turning."

With this latest ETF, DoubleLine continues to adapt to a changing market environment, offering investors access to specialized fixed-income strategies that align with shifting macroeconomic trends.

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