Investors shaken by the Eurozone debt crisis and the volatility in stocks continue to flood into bond exchange traded funds.
However, those who recently piled into U.S. Treasury ETFs have been hit by the rally in bond yields, which has pushed prices lower. [Treasury ETF Sell-Off Picks Up Speed as Yields Leap]
“Year to date, taxable-bond ETFs have enjoyed the lion’s share of inflows,” investment researcher Morningstar said in its September flow wrap.
The taxable-bond category gathered the most inflows for the second straight month, raking in $5 billion in September after August’s $4.3 billion intake, according to Morningstar.
The largest contributors here were Vanguard Short-Term Bond ETF (NYSEArca: BSV), SPDR Barclays Capital High Yield (NYSEArca: JNK), iShares Barclays Aggregate Bond (NYSEArca: AGG) and iShares Barclays 7-10 Year Treasury (NYSEArca: IEF). [ETF Spotlight: BSV]