4 min readBy Beqa Bumbeishvili ETF Insider
How does the BSBE ETF work?
The BSBE ETF is a specialized investment fund that focuses on a specific sector. This exchange-traded fund offers investors exposure to a range of companies in this sector.
The BSBE ETF, managed by Invesco Indexing LLC, focuses on investing at least 80% of its total assets in securities that make up the Underlying Index. The Index Provider, affiliated with Invesco Capital Management LLC (the Fund's investment adviser) and Invesco Distributors, Inc. (the Fund's distributor), compiles and maintains the Underlying Index. This ETF aims to measure the performance of a portfolio of U.S. dollar-denominated emerging markets bonds with maturities, or effective maturities, in the year 2022. These bonds are drawn from a universe of investment grade and below investment grade U.S. dollar-denominated bonds issued by governments or entities in emerging markets countries. With a concentration policy that limits investments in any one industry, the BSBE ETF offers investors exposure to a unique segment of the bond market.
While the BSBE ETF (BSBE) primarily focuses on bonds with maturities in 2022, it has a unique approach to dividend distribution. The ETF's dividend distribution is influenced by the interest payments it receives from its underlying bonds, which are predominantly emerging market bonds. Bonds in the BSBE portfolio must meet specific credit rating and face value criteria to be eligible for inclusion. As the ETF approaches its termination date in December 2022, it transitions its holdings to cash and cash equivalents, which will be distributed to shareholders. While not a traditional dividend-focused ETF, BSBE offers an investment strategy with potential dividend-like returns based on the interest income from its bond holdings.
The BSBE Tracking ETF focuses on replicating the performance of the Underlying Index, which primarily consists of U.S. dollar-denominated emerging markets bonds maturing in the year 2022. Invesco Indexing LLC, the Index Provider, compiles and maintains the Underlying Index, and it is affiliated with Invesco Capital Management LLC, the Fund's investment adviser, as well as Invesco Distributors, Inc., the Fund's distributor. The Underlying Index comprises bonds issued by governments of countries classified as emerging markets by the Index Provider, including Brazil, Chile, China, and others. To be eligible for inclusion, these bonds must meet certain credit rating and face value criteria. BSBE Tracking ETF seeks to provide investors exposure to this specific segment of the bond market until its planned termination on or about December 15, 2022, transitioning to cash and cash equivalents during the final year of operation. Please note that BSBE Tracking ETF uses a sampling methodology and may concentrate its investments in industries as dictated by the Underlying Index.
The correlation aspect of the Invesco BulletShares 2022 USD Emerging Markets Debt ETF is not available in the provided information. To analyze the correlations for BSBE and gain valuable insights into its behavior in relation to other assets and sectors, investors can utilize the ETF Insider web app. This powerful tool offers deep and interesting data for various US ETFs, including BSBE, through its simple visualization tool, helping investors identify overlaps and make informed investment decisions. Whether for hedging, diversification, or risk management purposes, ETF Insider provides the necessary information to enhance your understanding of BSBE's correlations.
The BSBE Sector ETF primarily focuses on bonds issued by emerging markets countries, with an emphasis on U.S. dollar-denominated securities maturing in the year 2022. The ETF's investment strategy is designed to replicate the performance of its underlying index, which includes both investment grade and below investment grade bonds. While this approach offers potential opportunities in emerging markets, it comes with higher risk due to exposure to lower-rated bonds. As of August 31, 2021, the fund had significant exposure to the financials sector, and it is structured as a non-diversified fund, meaning it can have concentrated investments in specific industries when reflective of the underlying index. The ETF will terminate on or about December 15, 2022, and its portfolio will transition to cash and cash equivalents, marking its closure.
While we do not have specific information about the exposure characteristics of the BSBE ETF, our tool ETF Insider can help you discover its exposure using its web app. With ETF Insider''s simple visualization tool, you can access in-depth and interesting data for BSBE and other US ETFs. This includes insights into the markets, regions, sectors, overlap, correlations, and more, helping you make informed investment decisions.
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