April 07, 2011 at 10:35 AM EDT
State Street Launches Fundamental Corporate Bond ETF (CBND)
Innovation continues to be a defining characteristic of the quickly growing fixed income ETF space, as evidenced by the launch of the SPDR Barclays Capital Issuer Scored Corporate Bond ETF (CBND) on Thursday by State Street. The new ETF will seek to replicate the performance of the Barclays Capital Issuer Scored Corporate Index, a benchmark that includes U.S. dollar denominated corporate issues that are rated investment grade (Baa3/BBB- or higher) by at least two of the big three ratings agencies. CBND will be unique from existing products in the Corporate Bonds ETFdb Category because of the manner in which the underlying index is constructed. That methodology involves both determining the weightings attributed first to individual issuers and then to security weights. Individual issuers in the related benchmark are weighted based on three fundamental financial ratios (only debt issued by companies with publicly-traded stock are eligible for inclusion). Those ratios include: [...] Click here to read the original article on ETFdb.com. Related Posts: Bond ETF Ideas: Room For Growth In Fixed Income Arena Recapping Impressive Innovation In Bond ETF Space Russell, RAFI Team Up On Fundamental Indexes Bond ETF Revolution? State Street Plans Fundamental Fixed Income Fund Bond ETFs: 12 Stops Along The Risk/Return Spectrum
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