Hartford Funds, after launching a value ETF, plans to convert more of its mutual funds into ETFs to capitalize on the growing interest in the investment vehicles, a company official said.

The firm has converted its Hartford Quality Value Mutual Fund, which dates to 1996, into an ETF. The fund had $250 million in assets under management. The conversion will be the first of several the firm anticipates executing in the future, said Tom McConnell, head of product innovation and implementation at Hartford Funds.

“The virtues of ETFs we think are compelling and it set us on a search for what funds in our lineup might be a candidate for conversion,” he said.

McConnell said that there are no plans to make any more conversions this year. 

“You really need to treat each one idiosyncratically,” McConnell said. “But we’re continuing the work there and I don’t think that will be our last one.”

The Wayne, Pa.-based firm is turning its attention toward ETFs because of growing demand from advisors due to their advantages, McConnell explained. By converting existing mutual funds, as opposed to launching new ones, the firm already has an established track record that it can sell to advisors as well as distribution channels already in place, he said.

“We believe the trend will continue where the transparency, the cost efficiency, [and], the intra-day trading of ETFs is going to be compelling,” he said. “To be able to take a manager who’s done a great job on the strategy and offer it with both a track record and initial assets and where you have approvals at some broker-dealers it shortens the timeframe when we can deliver all these benefits in the ETF structure to our shareholders and hopefully to future shareholders.”

The conversion of QUVU served as a trial run for the firm as it went through the process to determine how best to accomplish it, McConnell said, adding that the firm was satisfied with the first conversion.

“It was characterized by really good communication with shareholders and … it’s gone well enough that we’ll continue the work and look for the right candidates for future conversions,” he said.

QUVU is a traditional large-cap value fund that focuses on investing in high-quality, undervalued companies that have fallen out of favor and have less downside risk than the overall market, the firm said. The ETF, as was the case with the mutual fund, will be sub-advised by Wellington Management.

It will have an expense ratio of 45 basis points and be available on the same platforms as the mutual fund including Fidelity, Charles Schwab, and Pershing, McConnell said.