BlackRock’s iShares exchange-traded funds business has expanded its suite of iSharesBonds with four new Corporate Term ETFs.
These new products offer investors efficient access to a diversified pool of investment grade corporate credit securities with a defined maturity date, daily liquidity and price transparency.
For investors who are concerned about rising rates, the interest rate sensitivity of the iSharesBonds Corporate Term ETFs will decline through time as the funds approach maturity. If iSharesBonds are held until maturity, investors can expect to experience a yield that is similar to the yield to maturity of the underlying bonds held in the ETF. iSharesBonds can be used to target and manage interest rate risk, just like with a portfolio of individual bonds. Investors can also construct a bond ladder using iSharesBonds to help achieve a well-diversified portfolio for investments of almost any size.
The four iSharesBonds are:
iSharesBond 2016 Corporate Term ETF
iSharesBond 2018 Corporate Term ETF
iSharesBond 2020 Corporate Term ETF
iSharesBond 2023 Corporate Term ETF
iShares previously launched four iSharesBonds Corporate ex-Financials Term ETFs in April 2013. In the two months since launch the funds’ assets under management have grown over 30 per cent.
Matthew Tucker (pictured), head of iShares fixed income investment strategy, says: “iSharesBonds give investors an entirely new way to access the bond market, one that combines the benefits of both individual bonds and traditional ETFs. We expect the funds to be used by any investor who would use individual bonds, for building diversified portfolios, managing interest rate risk, and constructing bond ladders.
“Meeting our clients’ needs for efficient access to fixed income lies at the heart of the innovation of iSharesBonds. The launch of these four new iSharesBonds Corporate Term ETFs represents our continued commitment to innovation and bringing the best of BlackRock to our clients.”
