Vident Financial expanded its ETF lineup today, making the move into the fixed income space. The issuer was previously known for two funds, the International Equity Fund (VIDI), and the Core U.S. Equity ETF (VUSE). Both of these funds have been relatively successful, which bodes well for the product Vident launched this morning [for more ETF news and analysis subscribe to our free ETF Daily Roundup].
An All-Encompassing Bond Fund
The new ETF is the Core U.S. Bond Strategy ETF (VBND), which looks to take a unique view on fixed income investments. The fund will track an index that will seek to diversify across the fixed income world to help mitigate some of the common risks associated with debt securities. For the time being, its index is leaning heavily in favor of Treasuries, with a 51.2% allocation. But VBND’s index also has allocations to agency, corporate, and mortgage debt as its makeup currently stands.
From a maturity standpoint, the majority of its debts (nearly 75%) fall between three and seven years to maturity, which would make it more of an intermediate term product. Note that it does offer smaller allocations to short and long term debts as well.
Vident’s past ETFs have also featured indexes that go beyond the plain-vanilla exposure, and it has turned out well for them. Some issuers have a hard time getting funds off the ground with more unique indexes, but Vident is two for two with its ETF launches. You can learn more about the new fund and its index by clicking here.
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Disclosure: No positions at time of writing.