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Celebrating Three Years of Success for DoubleLine Opportunistic Core Bond ETF

On March 31, 2022, the DoubleLine Opportunistic Core Bond ETF, designated as DBND, made its debut on the NYSE Arca electronic exchange. Fast forward to March 31, 2025, and this actively managed exchange-traded fund now boasts a commendable three-year track record that showcases not only resilience but superiority over its benchmarks.

Performance Highlights

Over the last three years, the DBND ETF has delivered an annualized return of 1.66% based on net asset value. In comparison, the Bloomberg US Aggregate Bond Index, which serves as DBND’s benchmark, generated a return of just 0.52% during the same period. Moreover, when looking into the average annual stats of the Morningstar fund category, Intermediate Core-Plus Bond, which is relevant to DBND's strategy, it provides a mere 0.92% return on average.

What stands out in DBND's performance isn’t just the numbers; it has successfully achieved these superior returns while also exhibiting significantly lower risk. Metrics such as return volatility and maximum drawdown demonstrated that DBND effectively managed risk better than its benchmark and category peers, with statistics that favor its performance:
- Return Volatility: DBND’s standard deviation was at 7.08% compared to 7.51% for the category and 7.67% for the benchmark.
- Maximum Drawdown: While DBND saw its peak-to-trough decline capped at -8.92%, the regular drawdown for the Morningstar average measured -10.77%, marking a clear advantage for DBND.

Active Management Approach

The success of the DBND ETF can be significantly attributed to DoubleLine's robust active management style. According to Jeffrey Sherman, the Deputy Chief Investment Officer and lead portfolio manager for DBND, the fixed income strategy implemented via the Fixed Income Asset Allocation (FIAA) is crucial in navigating the evolving landscape of fixed income markets. Sherman highlighted an effective mix involving top-down sector allocations and bottom-up detailed credit analyses.

As of March 31, 2025, the portfolio allocation consisted of 48.5% in government and government-backed securities, particularly U.S. Treasuries and Agency mortgage-backed securities, while the rest, 51.5%, was directed to various credit instruments including corporate bonds and commercial mortgage-backed securities. This realignment from an initial 36.5% to 63.5% credit allocation when it launched, reflects the active adjustments made in response to market conditions.

Objectives and Future Outlook

The main objective of the DBND ETF is to maximize both current income and total return by investing at least 80% of its net assets in fixed income instruments or similar investments. The current strategy allows for up to 50% investment in below-investment-grade bonds, providing immense flexibility for various market conditions.

Looking ahead, the management anticipates various risk and return drivers to evolve and emphasizes the importance of an active strategy to ensure long-term and medium-term success amid market fluctuations. Skillfully navigating through uncertainties and adapting to shifts will be vital for maintaining DBND's competitive edge.

About DoubleLine

DoubleLine ETF Adviser LP manages multiple ETFs beyond DBND, including specialized funds across sectors to provide diverse investment opportunities. For investors looking to explore more about DoubleLine and its offerings, the complete range of ETFs can be accessed via their website. Remember, investments carry inherent risks, and thorough research along with professional advice is recommended before proceeding.

In summary, as DBND marks its third anniversary, it stands out not just for its impressive returns but for its strategic maneuvering in markets fraught with uncertainties, positioning itself effectively for continued performance excellence.