4 min readBy Ron Koren ETF Insider
How does the USIG ETF work?
The USIG 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 iShares Broad USD Investment Grade Corporate Bond ETF (USIG) is managed by BlackRock, Inc., one of the world's largest and most reputable asset management firms. USIG aims to track the ICE® BofA® US Corporate Index, which measures the performance of investment-grade corporate bonds, including those issued by both U.S. and non-U.S. entities, denominated in U.S. dollars and publicly issued in the U.S. domestic market. As of February 28, 2023, the Underlying Index comprises 9,831 issues, with a significant portion representing companies in the financials sector. BlackRock employs an indexing approach for USIG, emphasizing low portfolio turnover and cost efficiency, making it an attractive choice for investors seeking exposure to high-quality corporate bonds.
The iShares Broad USD Investment Grade Corporate Bond ETF (USIG) aims to track the performance of the ICE® BofA® US Corporate Index, which comprises investment-grade corporate bonds from U.S. and non-U.S. issuers, denominated in U.S. dollars and publicly issued in the U.S. domestic market. This ETF provides investors with exposure to high-quality corporate bonds with a remaining maturity of one year or more. While USIG may not prioritize dividends, it delivers periodic income distributions based on the interest payments from the underlying bonds, making it a suitable choice for income-seeking investors. Dividend eligibility is determined by the bonds' interest payments, and the distribution frequency aligns with the interest payment schedules of the underlying securities.
Tracking the ICE® BofA® US Corporate Index is the primary objective of the USIG ETF. This exchange-traded fund aims to replicate the performance of investment-grade corporate bonds, both from U.S. and non-U.S. issuers, denominated in U.S. dollars and publicly issued in the U.S. domestic market. As of February 28, 2023, the Underlying Index comprises 9,831 issues, with a notable concentration in the financials industry. The USIG ETF utilizes an indexing approach and representative sampling strategy to achieve its investment goal, providing investors with a cost-effective and tax-efficient option for exposure to the investment-grade corporate bond market.
The correlation aspect of the iShares Broad USD Investment Grade Corporate Bond ETF (USIG) is primarily tied to the performance of the ICE® BofA® US Corporate Index. This ETF is known for its strong correlation with investment-grade corporate bonds, both from U.S. and non-U.S. issuers, denominated in U.S. dollars and publicly issued in the U.S. domestic market. Given its focus on high-quality corporate bonds, USIG generally exhibits a low correlation with more volatile assets like equities, making it a suitable choice for conservative investors seeking stability and income from their portfolios. To explore and analyze USIG's correlations in more detail, ETF Insider offers a user-friendly web app with comprehensive data visualization tools, allowing investors to uncover valuable insights and overlaps with other assets and sectors.
The iShares Broad USD Investment Grade Corporate Bond ETF (USIG) primarily focuses on the investment-grade corporate bond sector. This ETF seeks to track the performance of the ICE® BofA® US Corporate Index, which comprises investment-grade corporate bonds issued in the U.S. domestic market, both by U.S. and non-U.S. issuers. As of February 28, 2023, a significant portion of the Underlying Index is represented by securities in the financials industry. USIG offers investors exposure to a diversified portfolio of high-quality corporate bonds, making it a suitable choice for those seeking stability and income in their investment portfolio.
The exposure characteristic of the iShares Broad USD Investment Grade Corporate Bond ETF (USIG) is centered around investment-grade corporate bonds from both U.S. and non-U.S. issuers. USIG seeks to track the ICE® BofA® US Corporate Index, which includes bonds denominated in U.S. dollars and publicly issued in the U.S. domestic market. As of February 28, 2023, the index comprised 9,831 issues, with a significant representation from the financials industry or sector. While the components of the Underlying Index may change over time, USIG aims to provide investors with a diversified exposure to investment-grade corporate bonds, focusing on securities with a remaining maturity of greater than or equal to one year.
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