BlackRock today announced the launch of the iShares 0-3 Month Treasury Bond ETF (SGOV). The fund will seek to track the investment results of the ICE 0-3 Month US Treasury Securities Index and is available on NYSE Arca.
The underlying index is composed of U.S. Treasury bills, notes and bonds with maturities of three months or less, including only fixed-coupon securities and excluding inflation-linked debt and Separate Trading of Registered Interest and Principal of Securities (STRIPS).
Steve Laipply, U.S. Head of iShares Fixed Income ETFs for BlackRock, said iShares is committed to providing investors with the tools they need to build resilient bond portfolios, the importance of which has been reinforced as investors sought safe havens in recent volatile markets.
“We’ve seen more than $26 billion in flows across the suite of iShares short-term bond ETFs year to date[1],” Laipply said. “The addition of SGOV to our U.S. Treasury and shorter maturity suites offers precise exposure for increased stability, liquidity and cash management.”
Expanding the iShares Treasury bond ETF suite
SGOV adds to the existing suite of 19 iShares Treasury bond ETFs, which represents $139.1 billion in AUM[2] (as of May 18, 2020) and offers investors a broad range of exposures, including:
- Maturity segments within the Treasury yield curve
- The entire yield curve
- Ticker: GOVT
- Treasury inflation-protected securities (TIPS)
- Floating rate notes (FRNs)
- Ticker: TFLO
- Maturity-year-specific iBonds
Growing demand for bond ETFs amid market volatility
Against the extraordinary backdrop of market turmoil driven by the COVID-19 crisis, a transformation has occurred in investor adoption of bond ETFs.
While bond markets experienced unprecedented volatility, dislocation and challenges in liquidity, bond ETFs played an indispensable role in the markets.
In the first quarter of 2020 alone, bond ETFs registered record trading volumes, reaching $1.3 trillion compared with $2.6 trillion globally for the entirety of 2019. Bond ETFs provided invaluable price discovery – helping investors understand rapidly changing market conditions at a time when it was most critical, and providing a benchmark reference for returns, volatility and sentiment.
iShares is a leading provider of bond ETFs, with more than $556 billion of assets under management globally and 333 products, as of March 31, 2020.
[1] As of May 28, 2020.
[2] Source: iShares.com, “Find iShares ETFs” https://www.ishares.com/us/products/etf-investments#!type=ishares&fac=43515&view=fixedIncomeView