ETF Buyers Go for Shorter-Duration Bonds as the Yield Curve Flattens
- Bond funds with nearer maturities see record inflows
- Trader bought $141 million block of iShares corporate bond ETF
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With the yield curve flattening and the Federal Reserve determined to continue raising interest rates, exchange-traded fund investors have been laying bets on bonds that mature sooner than later.
The iShares 0-5 Year Investment Grade Corporate Bond ETF, or SLQD, took in $245 million combined on Wednesday and Thursday, the most ever for the nearly five-year-old $1.1 billion fund. On Wednesday, one investor bought a massive block of 2.8 million shares worth $141 million, which accounted for 90 percent of SLQD’s volume for the day. It’s averaged about $6.5 million in turnover a day over the past year.