ETFdb Logo
ETFdb Logo
  • ETF Database
  • Channels
    • Active ETF
    • Beyond Basic Beta
    • China Insights
    • Climate Insights
    • Commodities
    • Core Strategies
    • Crypto
    • Disruptive Technology
    • Energy Infrastructure
    • ESG
    • ETF Building Blocks
    • ETF Education
    • ETF Strategist
    • Fixed Income
    • Free Cash Flow
    • Gold/Silver/Critical Minerals
    • Innovative ETFs
    • Institutional Income Strategies
    • Leveraged & Inverse
    • Managed Futures
    • Market Insights
    • Modern Alpha
    • Night Effect
    • Portfolio Strategies
    • Retirement Income
    • Richard Bernstein Advisors
    • Tax Efficient Income
    • Volatility Resource
  • Tools
    • ETF Screener
    • ETF Country Exposure Tool
    • ETF Sector Tracker Tool
    • ETF Database Categories
    • Head-To-Head ETF Comparison Tool
    • ETF Stock Exposure Tool
    • ETF Issuer Fund Flows
    • Indexes
    • Mutual Fund To ETF Converter
    • ETF Data for Journalists
    • ETF Nerds
  • Research
    • ETF Education
    • Equity Investing
    • Dividend ETFs
    • Leveraged ETFs
    • Inverse ETFs
    • Index Education
    • Index Insights
    • Top ETF Sectors
    • Top ETF Issuers
    • Top ETF Industries
  • Webcasts
  • Themes
    • AI ETFs
    • Blockchain ETFs
    • See all Thematic Investing ETF themes
    • ESG Investing
    • Marijuana ETFs
  • Multimedia
    • ETF 360 Video Series
    • ETF Trends on Videos
    • ETF Trends on Podcasts
    • ETF Prime Podcast
  • Company
    • About VettaFi
    • Get VettaFi’ed
  • PRO
    • Pro Content
    • Pro Tools
    • Advanced
    • FAQ
    • Pricing
    • Free Sign Up
    • Login
  1. ETF Education Channel
  2. The Argument for Bond Laddering in 2022
ETF Education Channel
Share

The Argument for Bond Laddering in 2022

Elle CarusoJan 24, 2022
2022-01-24

Advisers who have been in the business for decades likely used to ladder individual bonds but moved away from the strategy due to the difficulty of execution, something bond ETFs have alleviated.

When it comes to bond investing, ETFs hold several potential advantages over a ladder of individual bonds. Bond ETFs may offer greater control, diversification, and improved liquidity.

By owning bonds with different maturity dates and reinvesting in long-term bonds as other bonds mature, advisors can better manage a portfolio’s income stream and risk exposure.

Allocators are now turning to ETF bond ladders to help mitigate the impact of rising rates by allowing the reinvestment of periodic bond maturities at current interest rates.

“This is probably a good time for people to start coming back to something that they’ve set aside,” Jason Bloom, head of fixed income and alternatives ETF product strategy at Invesco, said.

Bond laddering is considered a timeless strategy because an investor can buy a bond or basket of bonds and hold them to maturity, meanwhile knowing what the total return is going to be, providing a high amount of visibility that is rare to find. 

How an investor prefers to ladder bonds, including which maturities are selected, high-yield versus investment-grade, as well as where an investor wants to be on the yield curve, may evolve from year to year depending on the backdrop, according to Bloom.

Many investors have already taken on bank loans and high-yield last year, so they’re now looking for other non-core exposures that can help boost the yield on their portfolios.

Investment-grade bond products, such as Invesco’s BulletShares fixed income ETFs, play to the current environment quite well, according to Bloom, as default rates are expected to remain low for the next couple of years.

For more news, information, and strategy, visit the ETF Education Channel.

Loading Articles...
Help & Info
  • Contact Us
Tools
  • ETF Screener
  • ETF Analyzer
  • Mutual Fund to ETF Converter
  • Head-To-Head ETF Comparison
  • ETF Country Exposure Tool
  • ETF Stock Exposure Tool
  • ETF Performance Visualizer
  • ETF Database Model Portfolios
  • ETF Database Realtime Ratings
  • ETF Database Pro
More Tools
  • ETF Launch Center
  • Financial Advisor & RIA Center
  • ETF Database RSS Feed
Explore ETFs
  • ETF News
  • ETF Picks of the Month
  • ETF Category Reports
  • Premium Articles
  • Alphabetical Listing of ETFs
  • Best ETFs
  • Browse ETFs by ETF Database Category
  • Browse ETFs by Index
  • Browse ETFs by Issuer
  • Compare ETFs
Legal
  • Terms of Use and Privacy Policy
  • © 2023 VettaFi LLC. All rights reserved.
Follow ETF Database
Follow ETF Database

Advertisement

Is Your Portfolio Positioned With Enough Global Exposure?

ETF Education Channel

How to Allocate Commodities in Portfolios

Tom LydonApr 26, 2022
2022-04-26

A long-running debate in asset allocation circles is how much of a portfolio an investor should...

Core Strategies Channel

Why ETFs Experience Limit Up/Down Protections

Karrie GordonMay 13, 2022
2022-05-13

In a digital age where information moves in milliseconds and millions of participants can transact...

}
X