JHancock Mortgage Backed Sec ETF's Average People Pillar and Process Pillar ratings result in a Morningstar Medalist Rating of Neutral. The portfolio maintains a cost advantage over competitors, priced within the cheapest fee quintile among peers.  

 The strategy’s management team earns an Average People Pillar rating. The strategy merits an Average Process Pillar rating. Independent of the rating, analysis of the strategy's portfolio shows it has maintained a significant underweight position in corporate bonds and A rated bonds compared with category peers. 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

Morningstar's style-agnostic investment process evaluation looks for strategies that should be able to outperform their Morningstar Category index on a risk-adjusted basis over time. John Hancock Mortgage Backed Sec ETF earns an Average Process Pillar rating.    The leading factor in the rating is the size of its portfolio management team. With four portfolio managers at the helm, the fund is reasonably well-resourced. Management team experience, which averages 19 years at this fund, also strengthens the process. Lastly, the process is limited by the parent firm's five-year risk-adjusted success ratio of 38%. The measure indicates the percentage of a firm's funds that survived and outperformed their respective category's median Morningstar Risk-Adjusted Return for the period. The parent's subpar success ratio suggests that the firm could do better across its fund lineup.

 Compared with other funds in the Intermediate Core-Plus Bond Morningstar Category, this fund, historically, hews closely to peers' credit and interest-rate sensitivity 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 meaningfully underweight corporate bonds in recent years. In the latest month, the strategy has also relatively underweighted corporate debt compared with Morningstar Category peers. Additionally, there's been a notable underallocation from A rated bonds over the past few years. Similarly, in recent months, the strategy also had less exposure to A rated bonds than peers. Finally, during the past few years, the fund leaned meaningfully away from debt with one- to three-year maturities. In recent months, the strategy also had less exposure to debt with one- to three-year maturities compared to its peers.

 This strategy's 12-month yield is 4.3%, higher than its average peer's 3.9%. In addition, it has a 4.7% 30-day SEC yield (a measure similar to yield-to-maturity). While a higher yield may deliver more income, it also tends to indicate higher credit risk. But that isn't always the case. Over the past 12 months, the average yield of the fund has been higher 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.

Average

Process

John Hancock Mortgage Backed Sec ETF earns an Average People Pillar rating. Jeffrey N. Given, the longest-tenured manager on the strategy, provides strong guidance, bringing forward over 25 years of listed portfolio management experience. The average Morningstar Rating of the strategies they currently manage is 2.9 stars, demonstrating underwhelming risk-adjusted performance. Jeffrey N. Given is supported by an experienced team, being able to draw on three additional listed managers, who average 19 years of 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.

People

Manulife Financial Corp has revamped its wealth- and asset-management business off the long-term strength of its successful U.S. unit, meriting an Above Average Parent rating. 

One of Canada’s Big Three life insurance companies, Manulife operates primarily in Canada, the United States, and Asia, with the bulk of assets in the U.S. The firm united its investment and wealth-management groups into a single, global segment in 2017 and 2018 and showcased it as a high-potential business. Since then, the group has restructured to mix three regional heads—U.S. & Europe, Asia, and Canada—with three global leaders segmented by channel: Retail, Retirement, and Institutional.

Manulife has entrusted this initiative to key individuals from its U.S. outfit, John Hancock Investments. For instance, Andy Arnott recently shifted from focusing on the U.S. and European unit to head up the firm’s global retail efforts. Leadership hopes this structure will allow it to leverage successful initiatives in its distinct regional markets.

John Hancock’s manager research team has long prioritized best-in-class managers regardless of firm affiliation. While much of the firm’s fixed-income strategies are run by Manulife teams globally, external managers dominate the firm’s equity lineup in the U.S. In its home market of Canada, Manulife’s internal teams, which boast strengths and weaknesses, manage most of the firm’s offerings, though the firm also has a strategic partnership with investment stalwart Mawer.

Above Average

Parent

John Hancock Mortgage-Backed Securities ETF

JHMB is actively managed and primarily invests in investment grade mortgage-backed securities issued or guaranteed by U.S. government and private entities with no specific limit to maturity.

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BOSTON, Feb. 15, 2022 /PRNewswire/ - John Hancock Investment Management LLC (the "Adviser") today announced changes to the portfolio management teams for John Hancock Preferred Income Fund (NYSE: HPI), John Hancock Preferred Income Fund II (NYSE: HPF), John Hancock Preferred Income Fund III (NYSE: HPS), John Hancock Premium Dividend Fund (NYSE: PDT), John Hancock Tax-Advantaged Divided Fund (NYSE: HTD), John Hancock Income Securities Trust (NYSE: JHS), John Hancock Investors Trust (NYSE: JHI), John Hancock Mortgage-Backed Securities ETF (NYSE Arca: JHMB), and John Hancock Preferred Income ETF (NYSE Arca: JHPI). Each Fund is advised by the Adviser and subadvised by Manulife Investment Management (US) LLC (the "Subadviser").

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