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Top 10 Total Bond ETFs

#6: Schwab U.S. Aggregate Bond ETF (SCHZ)

SCHZ follows the Barclays Capital U.S. Aggregate Bond Index which measures the performance of the U.S. investment grade bond market. The fund was launched recently in July 2011. The expense ratio is .10%. AUM equal $186 million and average daily trading volume 84K shares. SCHV trades commission free for Schwab customers.

As of late January the annual dividend yield was 2.64% and YTD return was -.15%. The most recent long term return was 6 months at 4.07%. 

Data as of First Quarter 2012

SCHZ Top Ten Holdings & Weightings

  1. US Treasury Note 2.625%: 1.51%
  2. US Treasury Bond 9.125%: 1.25%
  3. FNMA 5.5%: 1.24%
  4. FNMA 4.5% TBA: 1.24%
  5. US Treasury Note 0.25%: 1.21%
  6. US Treasury Note 1.375%: 1.14%
  7. US Treasury Note 2.5%: 1.13%
  8. US Treasury Note 1.75%: 1.13%
  9. FHLMC Tba Jan 30 Gold Single: 1.12%
  10. US Treasury Bond 4.375%: 1.10%

 

#7: SPDR Barclays Aggregate Bond ETF (LAG)

LAG also follows the Barclays Capital U.S. Aggregate Bond Index which measures the performance of the U.S. investment grade bond market. The fund was launched in May 2007. The expense ratio is .15%.

AUM equal $307 million and average daily trading volume is 43K shares. As of late January 2012 the annual dividend yield was 2.55% and YTD return was -.15%. The one year return was 7.39%. 

Data as of First Quarter 2012

LAG Top Ten Holdings

  1. FHLMC: 3.08%
  2. FNMA: 2.98%
  3. FNMA 4.5% TBA: 2.12%
  4. FNMA 4% TBA: 1.66%
  5. GNMA Jan 30 Single Fam: 1.57%
  6. US Treasury Note 3.125%: 1.54%
  7. FHLMC Tba Jan 30 Gold Single: 1.52%
  8. GNMA: 1.35%
  9. US Treasury Note 3.125%: 1.29%
  10. US Treasury Note 0.5%: 1.25%

 

#8: iShares Barclays Government / Credit Bond ETF (GBF)

GBF follows the Barclays Capital U.S. Government/Credit Bond Index. This ETF follows a wide range of bond issues with maturities greater than 1 year with roughly 47% below 5 years and balance evenly spread beyond. Over 65% of the assets are AAA rated with the balance investment grade except for 1.25% non-rated. The fund was launched in January 2007. The expense ratio is .20%.

AUM equal $124M and average daily trading volume is less than 8K shares. As of late January 2012 the annual dividend yield was 3.05% and YTD return .18%. The one year return was 10.10%.

Data as of First Quarter 2012

GBF Top Ten Holdings & Weightings

  1. US Treasury Note 4.625%: 6.39%
  2. US Treasury Note 4.75%: 6.01%
  3. US Treasury Note 3.625%: 5.97%
  4. US Treasury Bond 7.625%: 3.14%
  5. US Treasury Note 2%: 2.82%
  6. US Treasury Note 2.375%: 2.68%
  7. US Treasury Bond 4.5%: 2.67%
  8. US Treasury Note 1.25%: 2.28%
  9. US Treasury Note 1.25%: 2.28%
  10. US Treasury Note 0.625%: 2.24%

 

#9: iShares 10+ Year Government / Credit Bond ETF (GLJ)

GLJ (iShares 10+ Year Government/Credit Bond ETF) follows the BofA Merrill Lynch 10+ year U.S. Corporate & Government Index which includes publicly issued U.S. Treasury debt, U.S. government agency debt, taxable debt issued by U.S. states and territories and their political subdivisions, debt issued by U.S. and non-U.S. corporations, non-U.S. government debt and supranational debt.

The fund was launched in December 2009. The expense ratio is .20%. equal $24 million and average daily trading volume is less than 4K shares. As of late January 2012 the annual yield is 4.08% and YTD return was -1.51%. The one year return was 22.09%.

Data as of First Quarter 2012

GLJ Top Ten Holdings & Weightings

  1. US Treasury Bond 4.75%: 5.04%
  2. US Treasury Bond 3.875%: 3.93%
  3. US Treasury Bond 4.375%: 3.08%
  4. US Treasury Bond 3.5%: 2.76%
  5. US Treasury Bond 4.25%: 2.76%
  6. US Treasury Bond 4.375%: 2.44%
  7. US Treasury Bond 4.25%: 2.33%
  8. US Treasury Bond 4.75%: 2.10%
  9. US Treasury Bond 6.25%: 2.05%
  10. US Treasury Bond 7.25%: 1.75%


#10: PowerShares CEF Income Composite ETF (PCEF)

PCEF (PowerShares CEF Income Composite ETF) follows the S-Network Composite Closed-End Fund Index which is a rules-based index intended to give investors a means of tracking the overall performance of a global universe of U.S.-listed closed-end funds. CEFX is reconstructed on a quarterly basis from a universe of approximately 350 closed-end funds. The fund was launched in February 2010. The expense ratio is .50%. (Remember, holding closed-end funds means you're paying fees on them in addition to PCEF.)

AUM AUM equal $242 million and average daily trading volume is 78K shares. As of late January 2012 the annual dividend yield was 8.50% and YTD return was .70%. The one year return was 4.86%.

Data as of First Quarter 2012

PCEF Top Ten Holdings & Weightings

  1. Eaton Vance Tax-Mgd Glb Divrs Equity Inc: 5.28%
  2. Alliance Bernstein Income Fund: 4.20%
  3. Eaton Vance Limited Duration Income: 3.02%
  4. Eaton Vance Tax-Managed Divrs Equity Inc: 2.88%
  5. Eaton Vance Tx-Mgd Glbl Buy-Write Opp: 2.43%
  6. Aberdeen Asia-Pacific Income Fund: 2.39%
  7. Nuveen Multi-Strategy Income & Growth 2: 2.38%
  8. Blackrock Build America Bond Trust: 2.28%
  9. NFJ Dividend, Interest & Premium Strat: 2.07%
  10. Nuveen Quality Preferred Income 2: 1.76%

With the bonds listed above there are enough to choose from to satisfy any investor need. Again, 37 months of zero interest policies from the U.S. Fed have kept interest rates and yields low. Fear from stock market volatility and investor demographics have stimulated buying of bond ETFs overall.

It's also important to remember that ETF sponsors have their own competitive business interests when issuing products which may not necessarily align with your investment needs. New ETFs from highly regarded and substantial new providers are also being issued. These may include Charles Schwab's ETFs and Scottrade's Focus Shares which both are issuing new ETFs with low expense ratios and commission free trading at their respective firms. These may also become popular as they become seasoned. 

For further information about portfolio structures using technical indicators like DeMark and other indicators, take a free 14-day trial at ETF Digest . Follow us on Twitter and Facebook as well and join our group conversations.

You may address any feedback to: feedback@etfdigest.com   

The ETF Digest is long BNDin the featured ETFs. 

(Source for data is from ETF sponsors and various ETF data providers)

 

 

This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.

Dave Fry is founder and publisher of ETF Digest, Dave's Daily blog and the best-selling book author of Create Your Own ETF Hedge Fund, A DIY Strategy for Private Wealth Management, published by Wiley Finance in 2008. A detailed bio is here: Dave Fry.

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