BondBloxx Launches First Suite of Target Duration ETFs to Help Investors Get More Precise Exposure to U.S. Treasuries

News provided by

BondBloxx Investment Management Corporation

Sep 15, 2022, 09:00 ET

LARKSPUR, Calif., Sept. 15, 2022 /PRNewswire/ -- BondBloxx Investment Management announces the launch of a suite of eight duration-specific U.S. Treasury ETFs, which begin trading today on NYSE Arca. These first-to-market¹ ETFs seek to offer investors a more precise, lower cost way to get exposure to U.S. Treasury Securities. The funds track a series of indices developed by Bloomberg Index Services that include duration-constrained subsets of U.S. Treasury bonds with over $300 billion outstanding.²

"In today's rapidly changing interest rate environment, key priorities for portfolio managers and investors are earning higher yields on strategic cash positions, precisely managing duration risk, and having effective collateral tools," said BondBloxx Client Portfolio Manager JoAnne Bianco. "BondBloxx Target Duration U.S. Treasury ETFs may help investors in all these areas, with the potential benefits of being lower cost, transparent, liquid and tax efficient."

The new ETFs add to the existing eleven BondBloxx products that have been launched since February 2022, including seven industry sector-specific high yield bond ETFs, three ratings-specific high yield bond ETFs, and one short-duration emerging market bond ETF. BondBloxx has gathered more assets in new fixed income ETFs launched in 2022 than any other ETF issuer.³

"At BondBloxx, we're committed to building innovative fixed income tools for the markets of today and tomorrow," added BondBloxx co-founder Tony Kelly. "These new ETFs, which we believe finally make it possible for investors to truly manage their duration exposure with precision, are an exciting and potentially valuable addition to that investor toolkit."

BondBloxx was founded in October 2021 with a singular focus on developing precision fixed income ETFs designed for modern fixed income markets. In a landscape where less than one quarter of the ETF products available in the U.S. provide fixed income exposure⁴, the company aims to provide better tools for investors to manage their fixed income portfolios.

The new products listing today, with their tickers and expense ratios, are:

BondBloxx Bloomberg Six Month Target Duration US Treasury ETF
XHLF Expense Ratio: 0.03%
BondBloxx Bloomberg One Year Target Duration US Treasury ETF
XONE Expense Ratio: 0.03%
BondBloxx Bloomberg Two Year Target Duration US Treasury ETF
XTWO Expense Ratio: 0.05%
BondBloxx Bloomberg Three Year Target Duration US Treasury ETF
XTRE Expense Ratio: 0.05%
BondBloxx Bloomberg Five Year Target Duration US Treasury ETF
XFIV Expense Ratio: 0.05%
BondBloxx Bloomberg Seven Year Target Duration US Treasury ETF
XSVN Expense Ratio: 0.05%
BondBloxx Bloomberg Ten Year Target Duration US Treasury ETF
XTEN Expense Ratio: 0.075%
BondBloxx Bloomberg Twenty Year Target Duration US Treasury ETF
XTWY Expense Ratio: 0.125%

To learn more about BondBloxx, visit BondBloxxETF.com. For press inquiries please email [email protected]

About BondBloxx Investment Management Corporation

BondBloxx Investment Management Corporation ("BondBloxx"), a registered investment adviser, is the first ETF issuer focused solely on addressing the needs of fixed income investors. BondBloxx only transacts business in states where it is properly registered or is excluded or exempted from registration requirements. BondBloxx seeks to design and launch ETFs that offer precise market exposures to fixed income asset classes. For more information, go to BondBloxxETF.com.

Glossary:

A U.S. Treasury Security is a negotiable debt obligation issued by the U.S. government for a specific amount and maturity.

Precise refers to exposures that are targeted, accurate reflections of the sector as defined by Bloomberg Index Services.

Duration is the risk associated with the sensitivity of a bond's price to a one percent change in interest rates. As interest rates rise or fall over time, the duration of U.S. Treasury securities in broad maturity range indices, as well as the funds and ETFs that track those indices, drift lower or higher – this is known as "duration drift" and sometimes can be quite dramatic.

Duration-constrained refers to an index methodology that seeks to achieve a specific duration target.

Carefully consider the Funds' investment objectives, risks, charges, and expenses before investing. This and other information can be found in the Funds' prospectus or, if available, the summary prospectus, which may be obtained by visiting BondBloxxETF.com. Read the prospectus carefully before investing.

The Funds are newly organized entities and have no operating history.

U.S. Treasury Obligations Risk. U.S. Treasury obligations may differ from other securities in their interest rates, maturities, times of issuance and other characteristics and may provide relatively lower returns than those of other securities. Similar to other issuers, changes to the financial condition or credit rating of the U.S. government may cause the value of the Funds' U.S. Treasury obligations to decline. While U.S. Treasury obligations are backed by the "full faith and credit" of the U.S. Government, such securities are nonetheless subject to credit risk.

There are risks associated with investing, including possible loss of principal. Fixed income investments are subject to interest rate risk; their value will normally decline as interest rates rise, and vice versa. (This effect is usually more pronounced for longer-term securities.) Fixed income investments are also subject to credit risk, the risk that the issuer of a bond will fail to pay interest and principal in a timely manner, or that negative perceptions of the issuer's ability to make such payments will cause the price of that bond to decline. Fixed income securities also carry inflation risk, liquidity risk, call risk, and credit and default risks for both issuers and counterparties. Investing in mortgage- and asset -backed securities involves interest rate, credit, valuation, extension and liquidity risks and the risk that payments on the underlying assets are delayed, prepaid, subordinated or defaulted on. During periods of very low or negative interest rates, the Funds may be unable to maintain positive returns or pay dividends to Fund shareholders There is no guarantee that the funds will meet their stated investment objective. One cannot invest directly in an index.

The Funds are classified as "non-diversified" funds under the 1940 Act. The Funds may be susceptible to an increased risk of loss to the extent that the Funds' investments are concentrated in the securities and/or other assets of a particular issuer or issuers, sector, sub-sector, market segment, market, industry, group of industries, country, group of countries, region or asset class.

This shall not constitute or serve as an offer to sell products or services in any country or jurisdiction by BondBloxx. This document is for informational purposes only. All information is given in good faith and without warranty and should not be considered investment advice or an offer of any security for sale.

Distributed by Foreside Fund Services, LLC.

¹ These ETFs are the first designed to track indexes that achieve target durations using US Treasury securities, instead of specific maturities or maturity ranges. For more on Duration, please see The Glossary.
² Source: Bloomberg Data Services.
³ Source: Bloomberg as of 8/30/22. Excludes mutual fund assets that were converted into ETFs.
⁴ Source: ETF DB, as of July 2021.

SOURCE BondBloxx Investment Management Corporation