By moving down the yield curve, short-duration bond ETFs will experience smaller swings in a rising rate environment. For instance, a 1% rise in interest rates would only correspond to modest, if any, losses for ETFs like SHY. With an expense ratio of just 0.15%, SHY is a cost-effective option for the fixed income investor looking to fight the scourge of rising rates. [Bond ETFs on the Cheap]
iShares 1-3 Year Treasury Bond ETF
Tom Lydon’s clients own shares of HYG, SHY and SPY.