On Oct. 17, iShares launched two short-dated corporate bond ETFs, mimicking the highly successful investment-grade and high-yield corporate bond ETFs "LQD," iShares' iBoxx $ Investment Grade Corporate Bond fund (A-64), and "HYG," iShares' iBoxx $ High Yield Corporate Bond fund (B-72).
The iShares 0-5 Year High Yield Corporate Bond ETF (SHYG) and the iShares 0-5 Year Investment Grade Corporate Bond ETF (SLQD) cost 50 basis points and 15 basis points, respectively, and hold a portfolio of bonds with less than five years before maturity.
SHYG tracks the Markit iBoxx USD Liquid High Yield 0-5 Index, and SLQD tracks the Markit iBoxx USD Liquid Investment Grade 0-5 Index. The latter index meets the "investment grade" stipulation by holding corporate bonds with a minimum face value of $500 million.
The two new funds were specifically designed to address investor appetite for shorter-duration debt.