Nuveen Investments, which has been angling to get back into the exchange traded funds business after a lengthy absence, filed plans with the Securities and Exchange Commission to possibly launch an aggregate bond ETF, the NuShares Enhanced Yield U.S. Aggregate Bond ETF.
That ETF “would track an index comprised of investment grade government, corporate, residential and commercial mortgage-backed securities and asset-backed bonds. It will track an index called the TIAA Enhanced Yield U.S. Aggregate Bond Index (TIAA Global Asset Management owns Nuveen),” reports Chris Dieterich for Barron’s.
Aggregate bond ETFs, such as the iShares Core U.S. Aggregate Bond ETF (NYSEArca: AGG), which tracks the Barclays Aggregate Bond Index, are favorites among advisors and investors, but these funds are often heavily allocated to Treasuries, implying some level of vulnerability should interest rates climb.
With plenty of assistance from the Federal Reserve’s refusal to raise interest rates to this point in 2016, fixed income exchange traded funds have been favored destinations for advisors and investors. Four of this year’s top 10 asset-gathering ETFs are bond funds.