Additionally, mortgage securities make up 72% of the ETF compared to 52% in the mutual fund while Treasury bonds account for 56% of BOND compared to about 40% for the mutual fund counterpart.
BOND has also paved the way for actively managed ETFs to gain back the spotlight. The only drawback to this type of fund is the possibility of front running, but a long term track record will prove if this is detrimental or not.
For now, BOND has lived up to the hype and has been able to do so without the use of derivatives. Investors that are interested in BOND also save a bit in the way of basis points. Whether or not the trend can continue is yet to be seen, but investors are watching.
Tisha Guerrero contributed to this article.