FlexShares iBoxx 5 Year Target Duration TIPS Index Fund (ARCA: TDTF)

最新ニュース FlexShares iBoxx 5 Year Target Duration TIPS Index Fund (ARCA:TDTF)

FlexShares iBoxx 5 Year Target Duration TIPS Index Fund

The underlying index reflects the performance of a selection of inflation protected public obligations of the U.S. treasury, commonly known as TIPS, with a targeted average modified adjusted duration, as defined by the index provider, of approximately five years. Under normal circumstances, the fund will invest at least 80% of its total assets (exclusive of collateral held from securities lending) in the securities of the underlying index. The fund is non-diversified.

Global investment giant BlackRock has announced being &#8220;overweight&#8221; on inflation-linked bonds, signaling a strategic shift to mitigate risks stemming from &#8220;persistent inflation pressure&#8221; and growing concerns over the sustainability of U.S. government finances.
What Happened: This move comes as the firm navigates a complex economic landscape characterized by transformative &#8220;mega forces&#8221; and a challenging outlook for long-term asset allocation.
A key driver for BlackRock&#8217;s pivot to inflation-linked bonds is the mounting pressure on U.S. fiscal sustainability.
The firm specifically cited <a href="https://www.benzinga.com/news/econ-s/25/05/45479078/moodys-downgrades-us-credit-rating-over-debt-deficit-concerns">Moody&#8217;s recent downgrade</a> of the U.S. government&#8217;s top-notch credit rating, which reinforced BlackRock&#8217;s long-standing concerns about persistent U.S. budget deficits, particularly as rising interest rates escalate debt servicing costs.
The note also highlights how the U.S. debt sustainability relies on large and steady funding by foreign investors.
&#8220;The downgrade reinforces the U.S. fiscal sustainability challenge that we&#8217;ve long flagged, especially persistent U.S. budget deficits at a time when higher interest rates are boosting debt servicing costs. If these dynamics dent the confidence of foreign bond holders, rising term premium could push up bond yields and debt servicing costs even more,&#8221; explained BlacRock in its note.
Consequently, BlackRock&#8217;s strategic starting point now incorporates an expectation of rising term premiums for U.S. Treasuries and persistent inflation.
&#8220;That's why our starting point also includes our expectation of rising term premium for U.S. Treasuries and persistent inflation pressure. We go overweight inflation-linked bonds and neutral global investment grade credit given wider spreads,&#8221; the note stated.
These securities are designed to protect investors from inflation by adjusting their principal value based on changes in the Consumer Price Index (CPI), ensuring that the real value of the investment is preserved.
See Also: <a href="https://www.benzinga.com/general/market-summary/25/05/45512063/ray-dalio-warns-against-decreasing-value-of-us-dollar-amid-mounting-government-debt-risks-are-greater-than-the-rating-agencies-are-conveying">Ray Dalio Warns Against Decreasing Value Of US Dollar Amid Mounting Government Debt: &#8216;Risks Are Greater Than The Rating Agencies Are Conveying&#8217;</a>
Why It Matters: For investors seeking exposure to this strategy, a few of the inflation-linked bond ETFs available include:
<figure class="wp-block-table is-style-stripes"> 
<table class="has-fixed-layout">
<tbody>
<tr>
<td>Inflation-Linked Bond ETFs</td>
<td>YTD Performance</td>
<td>One Year Performance</td>
</tr>
<tr>
<td>Vanguard Short-Term Inflation-Protected Securities ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/VTIP#NASDAQ">VTIP</a>)</td>
<td>3.03%</td>
<td>3.68%</td>
</tr>
<tr>
<td>iShares TIPS Bond ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/TIP#NYSE">TIP</a>)</td>
<td>2.04%</td>
<td>2.21%</td>
</tr>
<tr>
<td>Schwab U.S. TIPS ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SCHP#NYSE">SCHP</a>)</td>
<td>2.44%</td>
<td>2.05%</td>
</tr>
<tr>
<td>iShares 0-5 Year TIPS Bond ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/STIP#NYSE">STIP</a>)</td>
<td>1.79%</td>
<td>3.15%</td>
</tr>
<tr>
<td>FlexShares iBoxx 3-Year Target Duration TIPS Index Fund (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/TDTT#NYSE">TDTT</a>)</td>
<td>1.99%</td>
<td>2.29%</td>
</tr>
<tr>
<td>SPDR Bloomberg 1-10 Year TIPS ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/TIPX#NYSE">TIPX</a>)</td>
<td>2.49%</td>
<td>2.87%</td>
</tr>
<tr>
<td>SPDR Portfolio TIPS ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SPIP#NYSE">SPIP</a>)</td>
<td>1.85%</td>
<td>1.22%</td>
</tr>
<tr>
<td>FlexShares iBoxx 5-Year Target Duration TIPS Index Fund (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/TDTF#NYSE">TDTF</a>)</td>
<td>2.41%</td>
<td>2.10%</td>
</tr>
<tr>
<td>PIMCO 15+ Year US TIPS Index ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/LTPZ#NYSE">LTPZ</a>)</td>
<td>-0.90%</td>
<td>-4.69%</td>
</tr>
<tr>
<td>PIMCO 1-5 Year US TIPS Index ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/STPZ#NYSE">STPZ</a>)</td>
<td>2.23%</td>
<td>3.88%</td>
</tr>
</tbody>
</table>
</figure>
&#8220;Economic transformation makes long-term portfolio construction more challenging,&#8221; BlackRock concluded, emphasizing its new approach of utilizing a starting point scenario for strategic views while formally tracking other potential outcomes to ensure portfolio agility.
While U.S. assets remain central to their portfolios, the move into inflation-linked bonds underscores a proactive stance against emerging fiscal and inflationary headwinds.
Price Action: The SPDR S&amp;P 500 ETF Trust (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SPY#NYSE">SPY</a>) and Invesco QQQ Trust ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/QQQ#NASDAQ">QQQ</a>), which track the S&amp;P 500 index and Nasdaq 100 index, respectively, rose on Monday. The SPY was up 0.11% to $594.85, while the QQQ advanced 0.096% to $522.01, according to <a href="https://pro.benzinga.com/dashboard">Benzinga Pro</a> data.
On Tuesday, the futures of the S&amp;P 500, Dow Jones, and Nasdaq 100 indices were trading slightly lower.
Read Next:
<ul class="wp-block-list">
<li><a href="https://www.benzinga.com/25/05/45510990/federal-reserve-should-do-nothing-at-all-about-the-rising-yields-says-craig-shapiro-let-the-bond-vigilantes-eat" target="_blank" rel="noreferrer noopener">Federal Reserve Should Do ‘Nothing At All' About The Rising Yields, Says Craig Shapiro: ‘Let The Bond Vigilantes Eat'</a></li>
</ul>
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Photo courtesy: Tada Images / Shutterstock.com

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BlackRock Bets On Inflation, Goes 'Overweight Inflation-Linked Bonds' Amid US 'Fiscal Sustainability Challenge:' Here's A List Of ETFs Investors Can Consider

FlexShares, the ETF unit of Northern Trust (NASDAQ: <a class="ticker" href="/stock/ntrs#NASDAQ">NTRS</a>), could be looking to boost the size of its ETF lineup in a big way. The firm, which currently sponsors four funds, has filed plans with the Securities and Exchange Commission to possibly introduce six new dividend ETFs.

The <a href="http://www.sec.gov/Archives/edgar/data/1491978/000119312512359261/d397807d485apos.htm">filing for the funds did not include tickers or expense ratios</a>. If the funds come to market, the filing indicates they will trade on the New York Stock Exchange.

FlexShares filed plans for the following ETFs: the FlexShares Quality Dividend Index Fund, the FlexShares Quality Dividend Dynamic Index Fund , the FlexShares Quality Dividend Defensive Index Fund, the FlexShares International Quality Dividend Index Fund, the FlexShares International Quality Dividend Dynamic Index Fund and the FlexShares International Quality Dividend Defensive Index Fund.

FlexShares currently sponsors the FlexShares Morningstar Global Upstream Natural Resources Index ETF (NYSE: <a class="ticker" href="/stock/gunr#NYSE">GUNR</a>), the FlexShares iBoxx 3-Year Target Duration TIPS Index Fund (NYSE: <a class="ticker" href="/stock/tdtt#NYSE">TDTT</a>), the FlexShares iBoxx 5-Year Target Duration TIPS Index Fund (NYSE: <a class="ticker" href="/stock/tdtf#NYSE">TDTF</a>) and the FlexShares Morningstar U.S. Market Factor Tilt Index ETF (NYSE: <a class="ticker" href="/stock/tilt#NYSE">TILT</a>). 

GUNR is the largest with almost $446 million in assets under management.

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FlexShares Files Plans for 6 Dividend ETFs

Northern Trust's (NASDAQ: <a class="ticker" href="/stock/ntrs#NASDAQ">NTRS</a>) FlexShares family of ETFs, which debuted in September 2011, have reached a combined $1 billion in assets under management, the firm announced today.

"The demands of investors and the advisors who serve them continue to drive the evolution in the ETF landscape," said Shundrawn Thomas, head of Northern Trust's Exchange Traded Funds Group, in a statement. "Passing the $1 billion mark is an important milestone for us and affirms that our focus on distinctive products is valued by investors."

The four FlexShares ETFs are as follows: The FlexShares Morningstar U.S. Market Factor Tilt Index ETF (NYSE: <a class="ticker" href="/stock/tilt#NYSE">TILT</a>), the FlexShares iBoxx 5-Year Target Duration TIPS Index Fund (NYSE: <a class="ticker" href="/stock/tdtf#NYSE">TDTF</a>), the FlexShares iBoxx 3-Year Target Duration TIPS Index Fund (NYSE: <a class="ticker" href="/stock/tdtt#NYSE">TDTT</a>) and the FlexShares Morningstar Global Upstream Natural Resources Index ETF (NYSE: <a class="ticker" href="/stock/gunr#NYSE">GUNR</a>).

With over $381.6 million in AUM, the FlexShares Morningstar Global Upstream Natural Resources Index ETF is the largest of the FlexShares ETFs. The FlexShares iBoxx 3-Year Target Duration TIPS Index Fund is the second-largest with almost $327 million in AUM.

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FlexShares ETFs Top $1B in AUM

FlexShares iBoxx 5-Year Target Duration TIPS Index Fund

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FlexShares iBoxx 5 Year Target Duration TIPS Index Fund

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