The study also points out that professional investors are open to boosting allocations to fixed maturity or target-date funds.
“We believe institutional demand for these and other products that hold bonds in different maturity years would be positive for financial advisors and retail investors,” said S&P Capital IQ.
Fixed maturity ETF ideas include the Guggenheim BulletShares 2020 Corporate Bond ETF (NYSEArca: BSCK). The $304.7 million BSCK holds 188 bonds with an average effective duration of 4.58 years.
“The quantity of holdings in the Fund will be based on a number of factors, including the asset size of the fund, potential transaction costs in acquiring particular securities, the anticipated impact of particular index securities on the performance of the Index and the availability of particular securities in the secondary market. In the last six months of operation, when the bonds held by the Fund mature, the Fund’s portfolio will transition to cash and cash equivalents, including without limitation U.S. Treasury Bills and investment grade commercial paper,” according to Guggenheim.
S&P Capital IQ rates BSCK marketweight.
Guggenheim BulletShares 2020 Corporate Bond ETF