XONE Profile
The Bondbloxx Bloomberg One Year Target Duration US Treasury ETF aims to mirror the investment performance of the Bloomberg US Treasury 1 Year Duration Index, which includes U.S. Treasury securities with durations ranging between 6 and 18 months. The fund's strategy is designed to provide investors with exposure to short-duration U.S. Treasury securities, which are typically favored for their lower sensitivity to interest rate fluctuations compared to longer-duration securities.
Under normal market conditions, the ETF allocates at least 80% of its net assets, including any borrowings for investment purposes, to a portfolio of U.S. Treasury securities. These securities are selected to ensure the fund's average duration aligns closely with approximately one year. This duration strategy helps to manage interest rate risk, making the fund suitable for investors seeking stability and lower volatility in a rising interest rate environment.
The fund achieves its investment objective by investing directly in U.S. Treasury securities or indirectly through financial instruments such as derivatives, which are designed to replicate the performance characteristics of the targeted securities. This flexibility allows the fund to efficiently manage its duration exposure and adjust its portfolio as needed to maintain alignment with the Bloomberg US Treasury 1 Year Duration Index.
As a non-diversified fund, the ETF's holdings are concentrated in U.S. Treasury securities, reflecting its focus on providing investors with a stable and predictable income stream while mitigating interest rate risk through its short-duration strategy. Investors considering this fund should be aware of its specific focus on U.S. Treasury securities and its implications for yield and risk compared to other fixed-income investments.
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