BlackRock, Inc. (NYSE: BLK) announced today that its iShares Exchange Traded Funds (ETFs) business, the world’s largest manager of ETFs 1, has expanded its suite of iSharesBonds TM 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 utilized 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 launched today are as follows:
- iSharesBond 2016 Corporate Term ETF (NYSEArca: IBDA)
- iSharesBond 2018 Corporate Term ETF (NYSEArca: IBDB)
- iSharesBond 2020 Corporate Term ETF (NYSEArca: IBDC)
- iSharesBond 2023 Corporate Term ETF (NYSEArca: IBDD)
iShares previously launched four iSharesBonds Corporate ex-Financials Term ETFs in April 2013. In the two months since launch the funds’ Assets Under Management (AUM) have grown over 30%, illustrating the strong demand investors have for iSharesBonds defined maturity ETFs.Matthew Tucker, Head of iShares Fixed Income Investment Strategy commented: “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.