Investors can now get more precise exposure to targeted maturities of BBB-rated corporate bonds, a persistent outperformer within the U.S. investment grade universe1
LARKSPUR, Calif., Jan. 25, 2024 /7Newswire — BondBloxx Investment Management today proudly announces the launch of three BondBloxx Investment Grade Corporate Bond ETFs:
These first of their kind ETFs target more precise maturities of 1-5, 5-10, and 10+ years within the BBB-rated corporate bond category, which has been a persistent outperformer within the U.S. investment grade bond universe.1 While there are existing funds that target maturity ranges within investment grade corporate bonds, these funds offer a new level of precision by enabling investors to target BBB-rated corporate bonds within various maturity ranges.
“Investors who own broad investment grade ETFs in different maturity categories can now use these new BondBloxx ETFs to target BBB-rated bonds and benefit from the higher coupon of this compelling segment within the investment grade corporate bond market” said BondBloxx Co-Founder Tony Kelly. Over the past two decades, BBB-rated corporate bonds have historically outperformed the broad investment grade corporate bond universe by over 50 basis points per year, with no incremental default risk.2
Attractive yields for BBBs today, combined with the credit rating category’s still resilient fundamentals, indicate that BBB exposure can continue to enhance fixed income performance compared to all segments of the US Aggregate, added the BondBloxx team. Continued strength across multiple U.S. economic indicators, coupled with yields at 13-year highs,3 also supports the strong credit fundamentals expected for BBB-rated corporate debt in 2024.
“Investment grade corporates continue to be an area of focus for investors, and within that universe BBBs offer a unique opportunity for potential outperformance” emphasized JoAnne Bianco, Investment Strategist at BondBloxx. “Yet until now, investors were quite limited in their portfolio building options when it came to adding targeted BBB exposures. We’re excited to innovate and solve that issue for investors and advisors by bringing these new funds to market.”
“Fixed income is all that we do,” added Kelly. “We’re unwavering in our mission to provide high-precision tools to help investors and advisors access opportunities in the fixed income market, and these new ETFs provide a compelling addition to our fast-growing family of funds.”
To learn more about BondBloxx, visit BondBloxxETF.com.
BondBloxx Investment Management Corporation (“BondBloxx”) is the first ETF issuer to focus solely on fixed income, offering a range of exposures spanning U.S. Treasuries, investment grade corporate bonds, high yield bonds, and emerging markets bonds. To learn more about BondBloxx’s fixed income-first mission, visit BondBloxxETF.com. For press inquiries, please email firstname.lastname@example.org
BondBloxx is a registered investment adviser and only transacts business in states where it is properly registered or is excluded or exempted from registration requirements.
Carefully consider the Funds’ investment objectives, risks, charges, and expenses before investing. This and other information can be found in the Funds’ prospectus or, if available, the summary prospectus, which may be obtained by visiting bondbloxxetf.com. Read the prospectus carefully before investing.
There are risks associated with investing, including possible loss of principal. Fixed income investments are subject to interest rate risk; their value will normally decline as interest rates rise. Fixed income investments are also subject to credit risk, the risk that the issuer of a bond will fail to pay interest and principal in a timely manner, or that negative perceptions of the issuer’s ability to make such payments will cause the price of that bond to decline. Investing in mortgage- and asset -backed securities involves interest rate, credit, valuation, extension and liquidity risks and the risk that payments on the underlying assets are delayed, prepaid, subordinated or defaulted on. Investment grade bonds have ratings of BBB- or above. High yield bonds have ratings of BB+ and below. BBB-rated bonds are typically subject to greater risk of downgrade than other investment grade bonds, especially during an economic downturn or substantial period of rising interest rates. Any downgrade of such bonds would relegate such bonds from the investment grade universe to the high yield (or “junk” bond) universe, which could negatively affect their liquidity and their value.
Nothing in this statement is intended to, nor will, constitute an offer (or an invitation to make an offer) to buy, sell or otherwise transact in any investment fund and/or strategy referred to on the Website or any other security or financial instrument, or to provide any investment services or advice in any jurisdiction.
Distributor: Foreside Fund Services, LLC
1 Source: Bloomberg, as of 12/31/23. Based on the ICE BofA BBB US Corporate Index compared to the ICE BofA US Broad Market Index, the ICE BofA US Treasury Index, the Bloomberg US MBS Index, and the Bloomberg US ABS Index, comparing 1-, 3-, 5- and 10-year annualized returns. Past performance is not indicative of future results.
2 Source: Bloomberg, ICE Data Services based on annualized returns for the 20-year period of 2003-2023. Past performance is not indicative of future results. It is not possible to invest directly in an index.
3 Source: Bloomberg, as of 12/31/23.
SOURCE BondBloxx Investment Management Corporation