iShares iBonds ... a bond, but a stock, but an ETF, but yield

I’m guessing since the new iShares iBonds are not London listed nor do they trade in GBP we are not going to see them added to the InvestEngine platform?


Humm interesting…I’ve just had a quick look, I don’t think they’re regulated to be sold in Europe/UK yet - sounds like one we’ll have to ask our friends at Blackrock about!

I’ll also ask our invest team if they have any more info on these IBonds – I know they’ve previously included TIPs bonds in portfolios but I’m not sure it there similar

They are registered for sale in the UK and produce a UK KIID but they only trade on European exchanges in EUR… so not something IE would usually get involved with

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From Our Investment team

This was announced last week I think - it’s part of Blackrock’s partnership with Bux in Europe. iBonds are basically fixed maturity bond ETFs (as opposed to the usual fixed duration). There are no GBP ones yet so we can’t add them but we’re following how they are received in the market.

(Also, not to be confused with the US I-Bonds which are US inflation-linked bonds)

Nothing to do with BUX.

BUX just released an intentionally misleading PR statement that made it sound like they had a hand in the creation process.

BUX pretty much put the asset on their platform. That’s it. Nothing more. So : a couple of identifiers, some settlement details and a few text strings in to a back office system.

But well done BUX for the biggest (inferred) over statement ever.

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Oh very interesting. I’m not sure if I should tell our marketing team about this it might give them some ideas. Thanks for highlighting @Haggis_Mince

You should. They should.

I, for example, didn’t know InvestEngine ran Corporate Accounts for business until a few ago.

Would businesses (of all sizes) be better off investing non-critical/operational cash into bonds/funds/etfs at the moment rather than (quite) lower interest rates on cash? Maybe. Maybe not. Either way it is worth pushing from a marketing perspective in case their is appetite for such products.

I raised IB26 and IB28 (above) in that context.

Businesses might be off-put if faced with locking in to bonds/funds with underlying’s that have a fixed yield in this changeable environment. But if you limit/reduce the duration/maturity date(s) of the product then “some” (not all) of the risk of interest rate changes go away.

If you had sold even a US Gilt ETF to businesses/clients a few months ago the yield would now be trailing behind the Fed rate since the rate rises. OK, the capital value likely fell to account for that but that gives you another problem : explaining to client why that capital (you they inferred to be “safe”) fell. So new purchases may well be getting closer to 5.25 but the old purchases bought when rates were 4 and capital value was 99 looks different from capital value (make it up) 90 and yield to maturity 5.25 – which no one will hold til maturity as you can’t with an ETF – with the exception of these shorter duration IB26 and IB28

Food for thought.


Perhaps not.

But I’d imagine this is not the last we’ve seen of shorter duration ETFs that hedge out the longer term risk of interest rate movements in this volatile time.

When iShares release an ETF that matures weekly or monthly we’ll know the market appetite for these things is high (or peaked!!). But they serve a purpose.