Morgan Stanley's ETF Arm Levels Up, New Fund Breathes Life Into Old-School Mortgage Fund

Eaton Vance is bringing a little touch of mortgage heft to the ETF landscape.

The company, which is the ETF arm of Morgan Stanley, added to its lineup of actively managed fixed income offerings on Monday with the introduction of the Eaton Vance Mortgage Opportunities ETF (NYSE:EVMO). The fund is a repositioning of the Morgan Stanley Mortgage Securities Trust, a mutual fund with a history dating back to July 1997.

EVMO ETF hit the market this week. Check the prices live here.

What's Inside EVMO?

EVMO is actively managed and aims to provide diversified exposure to global securitized markets. Its holdings span the mortgage-backed securities (MBS) universe, including:

• Agency MBS
• Non-agency MBS
• Commercial MBS
• Other asset-backed securities

With a focus on security selection and collateral analysis, the fund’s managers position EVMO as a higher-quality, investment-grade substitute for corporate credit.

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Competitive Edge

EVMO has a 0.45% expense ratio, which places it competitively relative to actively managed ETFs. The launch joins other prominent offerings under the MSIM ETF umbrella, including:

Eaton Vance Total Return Bond ETF (NYSE:EVTR)

Eaton Vance High Yield ETF (NYSE:EVHY)

Calvert Ultra-Short Investment Grade ETF (NYSE:CVSB)

The Bigger Picture

EVMO’s launch coincides with a 2025 market environment that increasingly favors active fixed-income strategies and transparent ETF designs. As more legacy solutions transition from mutual funds into ETFs, companies like Eaton Vance are counting on a combination of liquidity, transparency, and established performance to appeal to yield-hungry investors.

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