GNMA Profile
The iShares GNMA Bond ETF is designed to provide investors with targeted exposure to mortgage-backed securities (MBS) issued by the Government National Mortgage Association (GNMA). The fund typically invests at least 80% of its assets in the securities included in its underlying index, as well as in to-be-announced (TBA) transactions that possess economic characteristics similar to those of the index's component securities.
The underlying index tracks the performance of fixed-rate mortgage-backed pass-through securities issued by GNMA, including those with 15-year and 30-year maturities. These securities are guaranteed by the U.S. government, which provides investors with a high level of credit safety. The index is designed to offer a comprehensive representation of GNMA MBS, allowing investors to gain exposure to the performance of these securities across different maturity profiles.
The fund seeks to mirror the investment performance of the index by holding a portfolio of GNMA securities and related TBA transactions. This strategy involves investing in a broad array of GNMA-issued MBS, which helps in capturing the return characteristics of the index. The fund aims to reflect the performance of the GNMA MBS market while maintaining a high level of credit quality and liquidity.
As an ETF focusing on GNMA MBS, the iShares GNMA Bond ETF provides investors with a stable income stream derived from mortgage payments guaranteed by the U.S. government. The fund's concentrated focus on GNMA securities ensures exposure to a specific segment of the fixed-income market, potentially offering stability and relative safety compared to other types of MBS or non-government-backed securities.
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