iShares, the BlackRock unit and the world’s largest ETF provider, filed to launch an international exchange-traded fund that would tap into sovereign inflation-linked bonds denominated in local currencies across the developed and emerging world that would exclude the
With interest rates at historically low levels, investors have been increasingly shunning
The iShares International Inflation-Linked Bond Fund, by tracking the BofA Merrill Lynch International Diversified Inflation-Linked Index, would give investors access to a pool of 135 issues from a 16-country span that excludes the
While the filing didn’t disclose the proposed ETF’s price, the iShares fund would go head-to-head with the SPDR DB International Government Inflation-Protected Bond ETF (NYSEArca: WIP), which has gathered some $832.5 million in assets since its March 2008 inception.
WIP invests in a smaller pool of bonds—75 in total—but it taps into a similar mix of countries that include
About The Index
The BofA Merrill Lynch International Diversified Inflation-Linked Index is a “broad, market value weighted, capped total return index designed to measure the performance of inflation-linked sovereign debt that is publicly issued and denominated in the issuer’s domestic market and currency,” the filing said.
It comprises debt issued by countries that have at least $2 billion outstanding face value at inclusion and maintain at least $1 billion outstanding face value in index-qualifying debt.
The index is rebalanced monthly, and the fund will track its performance through a representative sampling strategy.
BlackRock Fund Advisors is the adviser for the fund.