SPDR® SSGA Fixed Inc Sect Rotation ETF’s management team is rated Average, but a solid investment process still helps this strategy retain its Morningstar Medalist Rating of Bronze. The portfolio maintains a cost advantage over competitors, priced within the second-cheapest fee quintile among peers.  

 The strategy's sensible investment philosophy merits an Above Average Process Pillar rating. Independent of the rating, analysis of the strategy's portfolio shows it has maintained an underweight position in securitized debt and debt with over 30-year maturities compared with category peers. The strategy’s management team earns an Average People Pillar rating. The strategy's parent organization earns the firm an Above Average Parent Pillar rating. People Pillar and Parent Pillar ratings for this strategy are indirectly assigned by a Morningstar analyst rather than algorithmically derived. Please see the notes following each pillar section for more details. The details of assigning methods can be found in each pillar section.

Analyst Rating

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Morningstar's style-agnostic evaluation of this fund's process seeks to understand whether the strategy has a performance objective and sensible, repeatable execution. SPDR® SSGA Fixed Inc Sect Rotation ETF earns an Above Average Process Pillar rating.    The primary contributor to the rating is the parent firm's five-year risk-adjusted success ratio of 58%. The measure indicates the percentage of a firm's funds that survived and beat their respective category's median Morningstar Risk-Adjusted Return for the period. The parent firm's excellent risk-adjusted performance, as shown by its average 10-year Morningstar Rating of 3.3 stars, also bolsters the rating. Lastly, the process is limited by the parent firm's five-year retention rate of 74%, which suggests it could do more to retain its portfolio managers.

 Compared with other funds in the Intermediate Core-Plus Bond Morningstar Category, this fund takes on significantly lower credit risk. But in terms of long-term interest-rate sensitivity, it hews closely to its average peer over the past few years. Opening the analysis to additional factors, the portfolio has displayed biases over time, whether towards or away from certain fixed-income instruments. Relative to the category average, the managers have been underweight securitized debt in recent years. In the latest month, the strategy has also relatively underweighted securitized debt compared with Morningstar Category peers. Additionally, there's been a notable bias away from debt with longer than 30-year maturities over the past few years. In the most recent month, however, the fund's exposure to debt with longer than 30-year maturities was in line with the Morningstar Category average. Finally, during the past few years, the fund leaned towards AAA rated bonds. In recent months, however, the strategy had less exposure to AAA rated bonds compared to its peers.

 This strategy's 12-month yield is 3.6%, lower than its average peers' 3.9%. Typically, a lower yield comes with the benefit of less credit risk. But that isn't always the case. Over the past 12 months, the average yield of the fund has been lower than the average yield of its Morningstar Category peers. The portfolio's average surveyed credit quality is on par with peers, with both the fund and the average being rated BBB.

Above Average

Process

SPDR® SSGA Fixed Inc Sect Rotation ETF earns an Average People Pillar rating. The team is backed by Michael O. Martel, the longest-tenured manager on the strategy, who brings 20 years of listed portfolio management experience. The average Morningstar Rating of the strategies they currently manage is 2.2 stars, indicating that their risk-adjusted returns have underperformed the category average. Michael O. Martel has an experienced backdrop of support. The three listed managers boast 13 years of average listed portfolio management experience.  

 Note: The People Pillar rating is indirectly assigned by an analyst. The longest-tenured manager of the fund also manages a different product rated by an analyst. Their analyst-assigned People Pillar rating is combined here with the People scores (algorithmic or analyst-assigned) for the fund’s other managers on a tenure-weighted basis.

Average

People

State Street Global Advisors is under new leadership but continues to move along the positive trajectory established by former leaders. SSGA maintains its Above Average Parent Pillar rating.
Cyrus Taraporevala, who oversaw much of SSGA’s recent transformation, retired from the CEO position in December 2022 and passed the baton to his successor, Yie-Hsin Hung. She inherited a business that’s become more disciplined with its fund lineup. Fees have come down, while product development remains focused on fixed-income and sustainability funds, and many of SSGA’s launches have echoed that intention.
The seeds that SSGA planted over the past several years have been bearing fruit. It built out a low-cost series of portfolio building-block ETFs in the U.S. bearing the “SPDR Portfolio” branding. SSGA launched these later than its industry rivals, so they aren’t as large. But they’re competitive, with solid management and low fees, which helped them consistently take in new money over the past several years.
SSGA continued to overhaul its ETF business in Europe with most of its recent fixed-income and sustainability fund launches. Many of these funds track indexes and charge relatively low fees. With operations in the U.S. and Europe standing on a firm foundation, SSGA will put more focus on its Asia-Pacific business—the smallest regional segment of its business.

Parent

SPDR SSGA Fixed Income Sector Rotation ETF

FISR is an actively-managed portfolio of fixed income ETFs classified within favorable sectors.

VanEck China Bond ETF

iShares J.P. Morgan EM Corporate Bond ETF

SPDR Bloomberg Emerging Markets Local Bond ETF

Morgan Stanley Emerging Markets Domestic Debt Fund Inc

Stone Harbor Emerging Markets Income Fund

Stone Harbor Emerging Markets Total Income Fund

WisdomTree Emerging Markets Local Debt Fund

VanEck Vct Emrg Shs

iShares JP Morgan USD Emerging Markets Bond ETF

Global X Emerging Markets Bond ETF 

iShares Interest Rate Hedged Emerging Markets Bond ETF

WisdomTree Emerging Markets Corporate Bond Fund

Western Asset Emerging Markets Debt Fund

iShares Emerging Markets High Yield Bond ETF

VanEck J.P Morgan EM Local Currency Bond ETF

ProShares Short Term USD Emerging Markets Bond ETF

SPDR DoubleLine Emerging Markets Fixed Income ETF

First Trust Emerging Markets Local Currency Bond ETF

VanEck Emerging Markets High Yield Bond ETF

JPMorgan USD Emerging Markets Sovereign Bond ETF

Krane Shares Trust - KraneShares CCBS China Corporate High Yield Bond USD Index ETF

KraneShares E Fund China Commercial Paper ETF

iShares J.P. Morgan EM Local Currency Bond ETF

Morgan Stanley Emerging Markets Debt Fund

Invesco Emerging Markets Sovereign Debt ETF

Vanguard Emerging Markets Government Bond ETF

Emerging markets offer attractive alternatives to fixed income investors searching for yield amid the trillions of dollars of negative-, zero-, and low-yielding debt globally. Within emerging market hard currency investment grade bonds, we think it is prudent to be shorter duration or at least hedge the Treasury risk component, given the low yield per unit of duration today.

3 Segments, Multiple Opportunities In Emerging Markets

News for SPDR SSGA Fixed Income Sector Rotation ETF ETF (FISR)