The world’s biggest ETF company unveils product push into three trendy pockets of the bond market.
iShares has put into registration six bond ETFs—four passive and two active—that amount to a broad move by the world’s biggest ETF firm into three prospective pockets of the bond market; namely, target date maturity funds; interest-rate hedged strategies; and floating-rate Treasurys.
The filings come at a time when rising interest rates and fears of a wind-down of the Federal Reserve’s bond-buying program are coursing through the markets and causing anxiety among bond investors. Last week’s stronger-than-expected 203,000 November jobs report and a drop in the unemployment rate from 7.3 to 7.0 percent has brought those concerns to the fore.
Benchmark 10-year Treasury yields, which were at 2.86 percent late on Dec. 5, were as low as 1.86 percent in early May—just before the Fed first started hinting it might soon start “tapering” its $85 billion-a-month bond-buying program designed to keep borrowing rates low.
iShares’ passive proposed offering include:
- iSharesBond 2019 Corporate ex-Financials Term ETF
- iShares Interest Rate Hedged 10+ Year Credit Bond ETF
- iShares Treasury Floating Rate Bond ETF
- iSharesBond 2019 Corporate Term ETF
Also, the firm is looking to launch two more interest-rate-hedged products, this pair actively managed. They are:
- iShares Interest Rate Hedged Emerging Markets Bond ETF
- iShares Interest Rate Hedged 0-5 Year High Yield Bond ETF.
No tickers or associated fees were available for the proposed funds.