Bond ETFs Debut

July 26, 2002 (PLANSPONSOR.com) - Investors have a new way to buy bonds, with today's launch of the first fixed income exchange traded funds.

The American Stock Exchange and Barclays Global Investors (BGI) today launched four Fixed Income iShares, the first debt-based ETFs to hit the market. The new iShares have expense ratios of just 0.15% and include:

  • iShares Lehman 1-3 Year Treasury Bond Fund (ticker: SHY)
  • iShares Lehman 7-10 Year Treasury Bond Fund (ticker: IEF)
  • iShares Lehman 20+ Year Treasury Bond Fund (ticker: TLT)
  • iShares GS $ InvesTop( Corporate Bond Fund (ticker: LQD)

BGI first introduced iShares on the American Stock Exchange in May 2000.

Fixed Income iShares are portfolios of bonds that can be bought and sold throughout the trading day like shares of stock, at prices determined by the market. Like traditional open-ended mutual funds, these bond-based ETFs allow investors to purchase a basket of bonds with one simple transaction.

In addition, whereas mutual funds are required to disclose their holdings semi-annually, iShares holdings are available daily, according to BGI.

The addition of the four Fixed Income iShares brings the total number of ETFs listed on the Amex to 121. BGI says it plans to list additional Fixed Income iShares on the AMEX at a later date.

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