iShares launches two rate hedged bond ETFs

iShares has launched two interest rate-hedged ETFs in a bid to offer investors exposure to corporate bonds while mitigating the risk of rising benchmark yields.

The two products - the iShares $ Corporate Bond Interest Rate Hedged and £ Corporate Bond Interest Rate Hedged UCITS ETFs - offer physically-backed exposure to corporate bonds. iShares said the products are aimed at investors looking for additional yield but who are concerned about the impact of changes in government bond yields on prices. The funds aim to mitigate interest rate risk by selling government bond futures and targeting a duration of zero. Tom Fekete, head of product development EMEA at iShares, said: "The new funds aim to mitigate interest rate risk and enable investor...