Higher yields in U.S. Treasuries have drawn more investors to the asset class. According to BondBloxx, this offers opportunities across the Treasury yield curve, depending on the investor’s specific investment goals and risk tolerance.
This is why BondBloxx launched eight duration-specific U.S. Treasury ETFs that offer a more precise, lower-cost way to get exposure to Treasuries.
If investors are uncertain about what’s ahead, they can consider short duration U.S. Treasuries. This includes the BondBloxx Bloomberg Six Month Target Duration US Treasury ETF (XHLF) and the BondBloxx Bloomberg One Year Target Duration US Treasury ETF (XONE). Short-term Treasury ETFs are seeing yields near the highest levels since 2007.
There are also investors who believe the Fed is wrapping up its rate hikes and/or the U.S. economy is slowing. may want to consider the middle part of the curve. A fund like the BondBloxx Bloomberg Seven Year Target Duration US Treasury ETF (XSVN) may be what they’re looking for.
Meanwhile, longer-dated U.S. Treasuries can be considered by investors who anticipate a harder landing for the economy. That’s where a fund like the BondBloxx Bloomberg Ten Year Target Duration US Treasury ETF (XTEN) can come into play.
An Alternative to Cash With High Yields
At a panel on VettaFi’s Fixed Income Symposium, BondBloxx co-founder Joanna Gallegos said that U.S. Treasuries have been a great alternative to cash. Plus, they’re a great way to capture as much yield as possible.
“It’s hard to walk away from a 5% risk-free yield,” Gallegos said.
BondBloxx was launched in October 2021 to develop precision fixed income ETFs. In a landscape where fewer than one quarter of the ETF products available in the U.S. provide fixed income exposure, the company aims to provide better tools for investors to manage their fixed income portfolios.
For more news, information, and analysis, visit the US Treasuries & TIPS Fixed Income Channel.