15 Key Types of Bond ETFs: 2008 Review

Some bonds have done well, some bonds have done exceedingly well and some bonds have done poorly during 2008. The credit crisis sent Treasuries into potentially bubble territory, and below investment grade bonds into the cellar.

When market conditions normalize, it may be reasonable to assume that “scared” money hiding in Treasuries will flow out and into credit bonds. That would probably cause rates on Treasuries to rise and prices to fall, while causing rates on credit bonds to fall and prices to rise. However, not much about credit markets in 2008 was as expected, so we’ll just have to wait and see. Watching the charts may help clarify the situation.

Here are 2008 weekly percentage performance charts for fifteen key types of US and non-US bond index funds:

1-3 Year US Treasuries

3-7 Year US Treasuries

7-10 Year US Treasuries

10-20 Year US Treasuries

20+ Year US Treasuries

Inflation Protected US Treasuries

US GNMA Bonds

US Mortgage-Backed Securities

US National Municipal Bonds

US Investment Grade Corporate Bonds

US Convertible Bonds

US Below Investment Grade (High Yield) Bonds

US Aggregate Bonds
(all excluding muni’s and < 12 mo’s)

Non-US Developed Country Investment Grade Treasuries
(local currency denominated)

Emerging Market Sovereign & Agency Bonds
(USD denominated)

Comments

[It Figures:]

Very Interesting. I don't know much about bond conventions, so two questions. Why weekly performance? While I can get the message of each chart, I'm not sure what any particular plot point actually represents. Do I add (actually multiply) together sequential plot points to determine performance from dates " A" to "B"?

Second, are these based on total return numbers, or strictly the price return on the ETF? It would seem with these especially, periodic payments count.

Thanks

2008 Dec 23 08:15 AM

[Seaferer20:]

I ask the same question as It Figures, i.e. what are bond weekly percentage performance figures? What does this represent re the overall quarterly/annual total return performance of a given ETF?

Thanks

2008 Dec 23 08:45 AM

[Internet2k4:]

Agree with the above comments - weekly arguably manages the volatility better, but line charts are much harder to decipher than OHLC. That said, I was glad to quickly learn of a couple of ETFs I wasn't aware of and where the sectors are relative to 0 line. I'm watching TBT as well, on the bet that treasuries are bubbly and there are too many auctions scheduled next year.

2008 Dec 23 09:34 AM

[Steve in TN:]

There is just not enough corporate bond ETFs available. I own the LQD which is a long-term ETF - I want to own an intermediate-term bond ETF. Sorry, none are available for sale. In the equity world, there are hundreds of ETFs for all categories, but not so in the bond area. Please iShare, ProShares, or whoever, let's have some more corporate bond ETFs!

2008 Dec 23 10:05 AM

[Adam Pawling:]

Hey Steve,

check this link- I think you might see some ETFs that match what you are looking for.

finance.yahoo.com/etf/...


On Dec 23 10:05 AM SteveTN wrote:

> There is just not enough corporate bond ETFs available. I own the
> LQD which is a long-term ETF - I want to own an intermediate-term
> bond ETF. Sorry, none are available for sale. In the equity world,
> there are hundreds of ETFs for all categories, but not so in the
> bond area. Please iShare, ProShares, or whoever, let's have some
> more corporate bond ETFs!

2008 Dec 23 12:27 PM

[Fatabner:]

On Dec 23 10:05 AM SteveTN wrote:

> There is just not enough corporate bond ETFs available. I own the
> LQD which is a long-term ETF - I want to own an intermediate-term
> bond ETF. Sorry, none are available for sale. In the equity world,
> there are hundreds of ETFs for all categories, but not so in the
> bond area. Please iShare, ProShares, or whoever, let's have some
> more corporate bond ETFs!

Take a look at BIV, GVI, CIU. These are 5-10 yr INT

2008 Dec 23 12:32 PM

[Indexor:]

Steve:

You want Intermediate-term corporate bond ETFs?

iShares - Barclays Intermediate Credit Bond ETF (CIU)

also consider:

iShares - Barclays 1-3 Year Credit Bond ETF (CSJ)
iShares - Barclays Credit Bond ETF (CFT)


If you're willing to accept a combination of Government/Credit Bonds:

Vanguard - Intermediate-Term Bond Index ETF (BIV)
iShares - Barclays Intermediate Government/Credit Bond ETF (GVI)
iShares - Barclays Government/Credit Bond ETF (GBF)

2008 Dec 23 12:41 PM

[squark62:]

pretty good articles and posted comments..

2008 Dec 23 01:05 PM