NEUBERGER BERMAN EXPANDS ACTIVELY MANAGED LINEUP WITH LAUNCH OF TOTAL RETURN BOND AND GROWTH ETFS
Rhea-AI Summary
Neuberger Berman has launched two new actively managed ETFs: the Total Return Bond ETF (NYSE: NBTR) and Growth ETF (NYSE: NBGX). The Total Return Bond ETF is a Core-plus fixed income portfolio with dynamic sector allocations, efficient use of 'plus' sectors, and active duration management, featuring a net expense ratio of 37 bps. The Growth ETF, led by Charles Kantor, employs a dynamic approach to large-cap growth investing through a quality lens, focusing on high-moat businesses with strong cash flow, with a net expense ratio of 44 bps. The firm manages $509 billion in assets and has over 2,800 employees across 26 countries.
AI-generated analysis. Not financial advice.
Positive
- Launch of two new actively managed ETFs expanding product lineup
- Competitive expense ratios of 37 bps for NBTR and 44 bps for NBGX
- Experienced portfolio management team with average 25+ years experience
- Strong institutional backing with $509 billion in assets under management
Negative
- New funds with no operating history to evaluate performance
- Higher expense ratios compared to passive ETF alternatives
- Risk of wider bid-ask spreads due to new fund status
- Potential for trading at premium/discount to NAV due to authorized participants
News Market Reaction – NBGX
On the day this news was published, NBGX gained 0.76%, reflecting a mild positive market reaction.
Data tracked by StockTitan Argus on the day of publication.
The new Neuberger Berman Total Return Bond ETF is a Core-plus fixed income portfolio seeking to outperform its benchmark over market cycles, driven by multiple potential alpha sources:
- Dynamic & Diverse Sector Allocations
Utilize a broad opportunity set of fixed income sectors—not limited to benchmark sectors. - Efficient Use of 'Plus' Sectors
Avoid static overweights to below-investment grade and emerging markets—dynamically adjust allocations based on portfolio managers' relative value views. - High Conviction Security Selection
Aims to be additive across credit market environments—best ideas approach built upon sector specialty research teams. - Active Duration Management
Active management of interest rate and yield curve exposures within a moderate band—normally ±2 years of the benchmark. - Experienced Team-Based Approach
Portfolio management team has an average of over 25 years of experience and collaborate with sector-specialty investment teams to incorporate insights from across our$200 billion
The ETF distributes any net investment income monthly and has a net expense ratio of 37 bps. (1)
The Neuberger Berman Growth ETF utilizes a fundamentally driven large cap equity strategy with a dynamic approach to growth investing through a quality lens:
- Experienced Leadership and Proven Track Record
The portfolio management team, led by Charles Kantor, has an average of over 25 years of investing experience and brings expertise in successfully managing client assets. - Strategic Investment Philosophy
The team employs a dynamic approach to growth investing through a quality lens, focusing on high-quality, high-moat businesses with strong cash flow and profitable earnings. They utilize an Economic Value Added (EVA) framework to identify companies the team believes are generating sustainable, value-creating growth. - Innovative and Disruptive Investments
Committed to finding companies that can disrupt the status quo and transform industries, the team seeks out businesses demonstrating meaningful innovation and strong execution, aiming to outperform over time.
The ETF has a net expense ratio of 44 bps. (2)
Neuberger Berman continually assesses where the firm's investment expertise intersects with client demand and the preference for an ETF vehicle which can reach a potentially wider range of investors. A well-resourced platform supports NB's Active ETF offering. Supported by a rigorous, research-based approach to active management. Neuberger Berman's team of investment professionals bring together deep market expertise, innovative data science capabilities, and strong corporate engagement tools to manage these investment solutions.
Neuberger Berman's actively managed ETFs include equities, fixed income, liquid alternatives and real assets.
About Neuberger Berman
Neuberger Berman is an employee-owned, private, independent investment manager founded in 1939 with over 2,800 employees in 26 countries. The firm manages
An investor should consider the ETFs investment objectives, risks and fees and expenses carefully before investing. This and other important information can be found in the Fund's prospectus, and if available summary prospectus, which you can obtain by calling 877.628.2583. Please read the prospectus, and if available the summary prospectus, carefully before making an investment.
All ETF products are subject to risk, including possible loss of principal. Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors, or general market conditions, including adverse issuer, political, regulatory, market, economic or other developments that may cause broad changes in market value, public perceptions concerning these developments, and adverse investor sentiment. An individual security may be more volatile, and may perform differently, than the market as a whole.
Unlike mutual funds, ETF shares are purchased and sold in secondary market transactions at negotiated market prices rather than at net asset value ("NAV") and as such ETFs may trade at a premium or discount to their NAV. As a result, shareholders of the Fund may pay more than NAV when purchasing shares and receive less than NAV when selling Fund shares. ETF shares may only be redeemed at NAV by authorized participants in large creation units. There can be no guarantee that an active trading market for shares will develop or be maintained or that the Fund's shares will continue to be listed. The trading of shares may incur brokerage commissions. The Fund has a limited number of Authorized Participants. To the extent they exit the business or are otherwise unable to proceed in creation and redemption transactions with the Fund and no other Authorized Participant is able to step forward to create or redeem, shares of the Fund may be more likely to trade at a premium or discount to NAV and possibly face trading halts or delisting.
Unexpected episodes of illiquidity, including due to market factors, instrument or issuer-specific factors and/or unanticipated outflows, could have a significant negative impact on the Fund's NAV, liquidity, and brokerage costs. To the extent the Fund's investments trade in markets that are closed when the Fund is open, premiums or discounts to NAV may develop in share prices.
The Fund is new with no operating history to evaluate. New funds may not attract sufficient assets to achieve investment, trading or other efficiencies and, if the Fund does not grow in size, it will be at greater risk than larger funds of wider bid-ask spreads for its shares, trading at a greater premium or discount to NAV and/or a stop to trading.
Foreign securities involve risks in addition to those associated with comparable
(1) Gross expense ratio is
(2) Gross expense ratio is
Additional Risks for Neuberger Berman Total Return Bond ETF
Shares in the Fund may fluctuate, sometimes significantly, based on interest rates, market conditions, credit quality and other factors. Generally, bond values will decline as interest rates rise. Typically, the longer the maturity or duration of a debt security, the greater the effect a change in interest rates could have on the security's price. The market's behavior is unpredictable and there can be no guarantee that the Fund will achieve its goal.
Lower rated debt securities (also known as "junk bonds") involve greater risks and may fluctuate more widely in price and yield, and carry a greater risk of default, than investment grade debt securities. They may fall in price during times when the economy is weak or is expected to become weak. Derivatives involve risks different from, and in some respects greater than, those associated with more traditional investments.
CDOs, which include collateralized loan obligations (CLOs), issue classes or "tranches" of securities that vary in risk and yield and may experience substantial losses due to interest rate fluctuations, actual defaults, collateral defaults, disappearance of subordinate tranches, market anticipation of defaults, and investor aversion to CDO securities as a class.
Derivatives can be highly complex, can create investment leverage and may be highly volatile, and the Fund could lose more than the amount it invests. Derivatives may be difficult to value and may at times be highly illiquid, and the Fund may not be able to close out or sell a derivative position at a particular time or at an anticipated price. The Fund's investments in derivatives create counterparty risk.
The Fund's performance could be affected if borrowers pay back principal on certain debt securities, such as mortgage- or asset-backed securities, before or after the market anticipates, shortening or lengthening their duration and could magnify the effect of rate increases on the security's price. When-issued and forward-settling securities can have a leverage-like effect on the Fund, which can increase fluctuations in the Fund's share price; may cause the Fund to liquidate positions when it may not be advantageous to do so, in order to satisfy its purchase obligations; and are subject to the risk that the security will not be issued or that a counterparty will fail to complete the sale or purchase of the security, in which case the Fund may lose the opportunity to purchase or sell the security at the agreed upon price. Leverage amplifies changes in the Fund's net asset value.
Floating-rate loans may be more susceptible to adverse economic and business conditions and other developments affecting the issuers of such loans. Although senior floating-rate loans are generally collateralized, there is no guarantee that the value of collateral will not decline, causing a loan to be substantially unsecured. No active trading market may exist for many loans, loans may be difficult to value and many are subject to restrictions on transfer or resale, which may result in extended trade settlement periods and may make certain investments less liquid and also prevent the Fund from obtaining the full value of a loan when sold.
Additional Risks for Neuberger Berman Growth ETF
The Fund is classified as non-diversified. As such, the percentage of the Fund's assets invested in any single issuer, or a few issuers is not limited as much as it is for a Fund classified as diversified. Investing a higher percentage of its assets in any one or a few issuers could increase the Fund's risk of loss and its share price volatility, because the value of its shares would be more susceptible to adverse events affecting those issuers.
Because the prices of most growth stocks are based on future expectations, these stocks tend to be more sensitive than value stocks to bad economic news and negative earnings surprises. When these expectations are not met or decrease, the prices of these stocks may decline, sometimes sharply, even if earnings showed an absolute increase. Bad economic news or changing investor perceptions may adversely affect growth stocks across several sectors and industries simultaneously.
Most of the Fund's performance depends on what happens in the stock market, the Portfolio Managers' evaluation of those developments, and the success of the Portfolio Managers in implementing the Fund's investment strategies. The market's behavior can be difficult to predict, particularly in the short term. There can be no guarantee that the Fund will achieve its goal.
The actual risk exposure taken by the Fund in its investment program will vary over time, depending on various factors including the Portfolio Managers' evaluation of issuer, political, regulatory, market, or economic developments. There can be no guarantee that the Portfolio Managers will be successful in their attempts to manage the risk exposure of the Fund or will appropriately evaluate or weigh the multiple factors involved in investment decisions, including issuer, market and/or instrument-specific analysis, valuation and ESG factors.
At times, mid-and large-cap companies may be out of favor with investors. Compared to smaller companies, large-cap companies may be unable to respond as quickly to changes and opportunities and may slower rate.
These and other risks are discussed in more detail in the Fund's prospectus. Please refer to the prospectus for a complete discussion of the Fund's principal risks.
This material is general in nature and is not directed to any category of investors and should not be regarded as individualized, a recommendation, investment advice or a suggestion to engage in or refrain from any investment-related course of action. Neuberger Berman is not providing this material in a fiduciary capacity and has a financial interest in the sale of its products and services. Investment decisions and the appropriateness of this material should be made based on an investor's individual objectives and circumstances and in consultation with his or her advisors.
The "Neuberger Berman" name and logo and "Neuberger Berman Investment Advisers LLC" name are registered service marks of Neuberger Berman Group LLC. The individual fund names in this piece are either service marks or registered service marks of Neuberger Berman Group LLC or Neuberger Berman Investment Advisers LLC, an affiliate of Neuberger Berman BD LLC, distributor, member FINRA.
Media Contact: Alex Samuelson, 212 476 5392, Alexander.Samuelson@NB.com
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