Market Extra: Investors embrace these Treasury ETFs despite September slump, as ‘belly’ of yield curve outperforms long end

by | Sep 27, 2023 | Stock Market

Bond-focused exchange-traded funds are struggling lately, but that’s not keeping investors away. The iShares 20+ Year Treasury Bond ETF
which has lost 7.8% this month through Tuesday on a total return basis, attracted $357 million from investors on Tuesday, according to FactSet data. That was its biggest daily inflow since Sept. 14, marking a third straight day of garnering capital. 

ETFs that buy long-term Treasurys have slumped this month as bond yields surged following the Federal Reserve’s decision earlier this month that signaled interest rates may remain at higher for longer as it seeks to curb elevated inflation. The so-called belly of the Treasury market’s yield curve looks more attractive to BlackRock’s senior iShares investment strategist Kristy Akullian.  “We see the three-to-seven year part of the curve as the sweet spot,” she said by phone.  The iShares 3-7 Year Treasury Bond ETF
on Tuesday saw its biggest inflow since July, attracting $170 million from investors in its third straight day of inflows, FactSet data show. The fund is faring much better than the larger iShares 20+ Year Treasury Bond ETF so far this month, down 1.4% through Tuesday on a total return basis.  While the short-end of the yield cu …

Article Attribution | Read More at Article Source

Share This