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Billions Are Flowing to Cash-Like ETFs in ‘Hunt’ Before Fed Hike

  • Ultra-short duration MINT sees biggest weekly inflows ever
  • Safety play might not last beyond the Fed’s liftoff: Chatwell
Updated on

What’s safer than short-duration bonds? Even shorter duration debt.

As investors brace for an increasingly aggressive Federal Reserve, money is flooding into cash-like ETFs -- which are seen as relatively less vulnerable to interest-rate risk. Traders have been piling into exchange-traded funds mostly focused on ultra-short instruments like Treasury bills, while offloading ETFs tracking longer-dated debt -- even those that are considered short-term bonds maturing in five years or less.