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Grail Advisors Bringing Fixed Income to Actively-Managed ETF Marketplace
Two New Bond Funds Will Feature Strategic Partnership With McDonnell Investment Management
| Source: Grail Advisors
SAN FRANCISCO, CA--(Marketwire - October 5, 2009) - Grail Advisors, an innovator in the
development and distribution of active-managed exchange traded funds
(ETFs), today announced the registration of two new actively-managed
fixed-income ETFs -- Grail McDonnell Intermediate Municipal Bond ETF and
Grail McDonnell Core Taxable Bond ETF.
McDonnell Investment Management, LLC (McDonnell), a Chicago-based
fixed-income specialist responsible for more than $13 billion assets(1)
under management, will serve as the sub-adviser to both of the funds. Grail
Advisors will serve as the funds' manager.
Similar to traditional actively-managed bond funds, the new Grail McDonnell
offerings will allow portfolio managers unrestricted trading.
"Our stated goal has been to bring a full lineup of traditional, active
fund managers and strategies to the ETF marketplace," said William M.
Thomas, CEO of Grail Advisors LLC. "These new fixed-income ETFs, both very
important additions to our actively-managed list, are made even more
compelling by the skill and experience of McDonnell Investment Management."
McDonnell specializes in fixed-income investment management, offering both
investment-grade taxable and tax-exempt strategies and below
investment-grade strategies using separate accounts, structured products,
and other private investment vehicles. Investment mandates include core,
limited maturity/duration, multi-sector, customized benchmark blends, and
below investment-grade credit. The firm is wholly-owned by a team of
professionals who were instrumental in developing the separate account
management business in 1987, when the group operated as part of Van Kampen
Investments. McDonnell was formed as an independently-owned, registered
investment advisor in 2001.
"We recognize that the investment demands of the marketplace are shifting
in response to today's market environment," said Edward Treichel, President
and CEO of McDonnell. "We stand poised with Grail Advisors to respond with
client-tailored investment solutions like these new Grail McDonnell ETFs."
Grail Advisors rolled out the market's first true, actively-managed equity
ETF in May -- the Grail American Beacon Large Cap Value ETF (NYSE : GVT ).
That fund was designed to incorporate traditional investment management
approach and a multi-manager format into an active ETF structure. The
Grail McDonnell offerings will combine all the benefits of an ETF structure
-- lower costs(2), tax efficiency(3), transparency of holdings(4), and
intra-day trading -- with actively-managed strategies from a veteran
fixed-income management team.
San Francisco-based Grail Advisors intends to increasingly make the
benefits of ETFs available to the large pool of investors who currently
select traditional mutual funds or other vehicles to access active
portfolio management. Mr. Thomas says Grail Advisors is currently in
discussions with a number of leading financial institutions and asset
managers, and expects to launch a number of customized, actively-managed
ETFs that will provide full, daily disclosure on all holdings.
About Grail Advisors LLC -- Grail Advisors LLC, an innovator in the
creation and distribution of actively managed Exchange Traded Funds,
partners with established asset managers, distributors, and related
financial institutions to design and deliver actively managed ETFs. Grail
Advisors was created to deliver ETFs using fully disclosed active portfolio
management to the global investment community. More information is
available at www.grailadvisors.com.
About McDonnell Investment Management, LLC -- McDonnell Investment
Management, LLC is a private fixed-income asset management firm based in
suburban Chicago. The firm manages approximately $13 billion in assets for
institutions, private clients, mutual fund companies, and private
investment funds across the U.S., Europe, and Asia. McDonnell is 100% owned
by its employees and is an SEC-registered investment adviser.
(1) As of 9/30/09.
(2) Ordinary brokerage fees apply.
(3) Exchange trading of ETFs further enhances their tax efficiency.
Investors who want to liquidate shares in an ETF simply sell them to other
investors through exchange trading. Because of this unique structure, ETFs
are not required to sell securities to meet investor cash redemptions,
potentially generating capital gains tax liability for remaining investors.
Keep in mind that the sale of an ETF will generate capital gains/losses for
the investor liquidating shares.
(4) ETFs are considered transparent because their portfolio holdings are
disclosed daily.
William M. Thomas is a registered representative of ALPS Distributors, Inc.
Shares are not individually redeemable and the owners of Shares may
purchase or redeem Shares from a Fund in
Creation Units only.
There are risks involved with investing including possible loss of
principal. The ETFs will be actively managed and the Shares may trade above
or below their net asset value. The trading price of Shares may deviate
significantly from net asset value during periods of market volatility.
Shares will not be FDIC insured, may lose value, and will have no bank
guarantee.
An investor should consider investment objectives, risks, charges, and
expenses carefully before investing. The
Prospectus contains this and other information. For more complete
information about the Grail McDonnell ETFs and the Grail American Beacon
Large Cap Value ETF or to obtain a Prospectus, call 415-677-5870. Please
read the Prospectus carefully before investing.
The information in the Prospectus is not complete and may be changed. The
Grail McDonnell ETFs may not sell their Shares until the registration
statement filed with the Securities and Exchange Commission is effective.
The Prospectus is not an offer to sell the ETFs' Shares, and the ETFs are
not soliciting an offer to buy their Shares in any jurisdiction where the
offer or sale is permitted.
The Grail McDonnell ETFs are new and have no operating history.
The Grail American Beacon Large Cap Value ETF is new and has limited
operating history.
ALPS Distributors, Inc. is not affiliated with the mentioned entities --
McDonnell Investment Management, LLC and Van Kampen Investments.
Grail McDonnell Intermediate Municipal Bond ETF, Grail McDonnell Core
Taxable Bond ETF, and Grail American Beacon Large Cap Value ETF are
distributed by ALPS Distributors, Inc.