According to a report from Morningstar.com, the four funds, to be called fixed-income trust receipts (FITRs), include
- Treasury 1 FITR
- Treasury 2 FITR
- Treasury 5 FITR
- Treasury 10 FITR
The funds will track Ryan Lab indices composed of the “on-the-run”, or most recently auctioned Treasuries of the FITR’s specific maturity. For example, Treasury 10 FITR will track an index comprising on-the-run 10-year Treasuries.
Because the one-year securities are no longer issued, the Treasury 1 FITR will follow an index with a two-thirds weighting in the most recently auctioned six-month T-bill, and a one-third weighting in the most recently auctioned two-year Treasury note.
According to Morningstar.com, the remaining Ryan indices consist of a single issue that turns over every time there is a Treasury auction in the corresponding maturity. However, the funds will build their portfolios using multiple securities, including Treasuries and agencies, to facilitate portfolio management. Each fund will attempt to match the duration of its corresponding index.