As risk slowly re-enters the market, corporate bond exchange traded funds (ETFs) have found increasing appeal. Companies have sold more than $1 trillion in new bonds this year, so it makes the timing of State Street‘s new bond fund especially appealing.
SPDR Barclays Short Term Corporate Bond ETF (NYSEArca: SCPB) invests only in investment-grade (with an average credit quality of A2/A3) short-term corporate bonds that are typically less sensitive to interest rate movements than intermediate or long-term bonds. [How to avoid a bond ETF bubble.]
The 0.12% expense ratio is a strong feature of this fund, too, reports Ron Rowland for Seeking Alpha. The underlying index has 572 holdings, a 1.9 year adjusted duration, and a 2.69% yield. [How to research bond ETFs.]
A few of the top weighted companies in the fund include:
- Goldman Sachs Group, 5.6%
- Conoco Funding, 4.6%
- General Electric, 4.5%
- Citigroup, 4.4%
- New Cingular Wireless, 3.9%
For more stories about bond ETFs, visit our bond ETF category.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.