This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

An ETF Bonding Experience

If you follow the ETF market at all, you already know that iShares and Lehman Brothers launched eight new fixed-income ETFs last week. They are:

  • Short Treasury Bond Fund (SHV)
  • 3-7 Year Treasury Bond Fund (IEI)
  • 10-20 Year Treasury Bond Fund (TLH)
  • 1-3 Year Credit Bond Fund (CSJ)
  • Intermediate Credit Bond Fund (CIU)
  • Credit Bond Fund (CFT)
  • Intermediate Government/Credit Bond Fund (GVI)
  • Government/Credit Bond Fund (GBF)
  • The funds with the word "Treasury" in their titles invest solely in Treasuries, the funds with the word "credit" are corporate bonds, and the funds with the words "government" and "credit" are a blend of Treasuries and corporates.

    These funds will help investors in some aspects but come up short in others.

    The bond ETFs that already existed were not a complete set, and where the treasury ETFs are concerned, SHV, IEI and TLH clearly fill the gaps. They give investors more specific control and management over their average maturity, plus the chance to reallocate in anticipation of interest rate changes, which, if done correctly, could serve to reduce bond portfolio volatility.

    These funds could also be a handy tool for institutional investors looking to speculate on various spreads across the yield curve getting narrower or wider. Combinations of two or more ETFs in various long/short permutations allow for some very sophisticated uses. The corporate and corporate/govie funds allow for more of the same between different fixed-income products, which creates an obvious path to foreign-bond ETFs, along with other segments within the bond market.
    1 of 3

    Check Out Our Best Services for Investors

    Action Alerts PLUS

    Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

    Product Features:
    • $2.5+ million portfolio
    • Large-cap and dividend focus
    • Intraday trade alerts from Cramer
    Quant Ratings

    Access the tool that DOMINATES the Russell 2000 and the S&P 500.

    Product Features:
    • Buy, hold, or sell recommendations for over 4,300 stocks
    • Unlimited research reports on your favorite stocks
    • A custom stock screener
    Stocks Under $10

    David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

    Product Features:
    • Model portfolio
    • Stocks trading below $10
    • Intraday trade alerts
    14-Days Free
    Only $9.95
    14-Days Free
    Dividend Stock Advisor

    David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

    Product Features:
    • Diversified model portfolio of dividend stocks
    • Updates with exact steps to take - BUY, HOLD, SELL
    Trifecta Stocks

    Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

    Product Features:
    • Model Portfolio
    • Intra Day Trade alerts
    • Access to Quant Ratings
    Options Profits

    Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

    Product Features:
    • Actionable options commentary and news
    • Real-time trading community
    SYM TRADE IT LAST %CHG
    CFT $111.01 0.31%
    CIU $108.27 0.00%
    CSJ $105.13 0.00%
    GVI $110.64 0.00%
    GBF $112.88 0.00%

    Markets

    Chart of I:DJI
    DOW 16,643.01 -11.76 -0.07%
    S&P 500 1,988.87 +1.21 0.06%
    NASDAQ 4,828.3250 +15.6170 0.32%

    Free Reports

    Top Rated Stocks Top Rated Funds Top Rated ETFs