3 Short-Term Fixed-Income ETF Strategies

Here are three short-term bond ETF strategies than investors can utilize in their portfolios to help temper any volatility in the stock market.

1. iShares 1-3 Year Credit Bond ETF (NASDAQ: CSJ)

CSJ tracks the investment results of the Bloomberg Barclays U.S. 1-3 Year Credit Bond Index where 90 percent of its assets will be allocated towards a mix of investment-grade corporate debt and sovereign, supranational, local authority, and non-U.S. agency bonds that are U.S. dollar-denominated and have a remaining maturity of greater than one year and less than or equal to three years–this shorter duration is beneficial given the time left for this extended bull market to run.

2. SPDR Portfolio Short Term Corp Bd ETF (NYSEArca: SPSB)

SPSB seeks to provide investment results that correspond to the performance of the Bloomberg Barclays U.S. 1-3 Year Corporate Bond Index. SPSB invests at least 80 percent of its total assets in securities designed to measure the performance of the short-termed U.S. corporate bond market. Ideally, shorter-term bond issues with maturities of three to four years are ideal to minimize duration exposure should the bull market enter a correction phase.

3. Vanguard Short-Term Corporate Bond ETF (NASDAQ: VCSH)

VCSH tracks the performance of the Bloomberg Barclays U.S. 1-5 Year Corporate Bond Index–a market-weighted corporate bond index with a short-term dollar-weighted average maturity. In addition to VCSH allocating capital towards debt issues that are investment-grade, fixed-income investors will like the reduced exposure to duration with maturities between 1 and 5 years.

 

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