The iShares US Fixed Income Balanced Risk Exchange Traded Fund (ETF) (INC) has begun trading on BATS Exchange.
The iShares US Fixed Income Balanced Risk ETF is the first iShares smart beta ETF for the fixed income market. The fund seeks to balance interest rate risk and credit risk, the two primary drivers of bond returns. The fund will invest in a diversified portfolio of corporate bonds, US Treasuries, and mortgage-backed securities, with each sector selected based on its historical risk vs return efficiency. The fund also uses US Treasuries and US Treasury futures contracts to manage the overall interest rate risk of the portfolio. This balanced approach to income generation may help deliver income as well as higher risk adjusted returns relative to that of the traditional market cap weighted bond benchmarks.
“We are excited to continue to grow our partnership with iShares with the launch of trading of the iShares US Fixed Income Balanced Risk ETF, the first iShares smart beta ETF for the fixed income market, on BATS Exchange,” says Brian King, Director of Listings at BATS. “Through innovative products such as this new ETF, iShares continues to be a pioneer in the ETF market.”
BATS does not charge an annual fee for issuers to list on BATS Exchange. Additionally, BATS is focused on improving market quality for every product that lists on the exchange through innovative market maker programs, which include the Competitive Liquidity Provider (CLP) and Lead Market Maker (LMM) programs. The CLP Program, which the iShares US Fixed Income Balanced Risk ETF will utilize, rewards market markers for tighter quoted spreads with increased liquidity on BATS-listed securities.