iShares Trust - iShares iBonds Dec 2031 Term Corporate ETF (IBDW)

Summary of ETF iShares Trust - iShares iBonds Dec 2031 Term Corporate ETF

Profile:

The iShares iBonds Dec 2031 Term Corporate ETF (IBND) is a passively managed exchange-traded fund that tracks the ICE BofAML US Corporate Index. This index includes investment-grade corporate bonds with maturities between 10 and 30 years. The ETF provides investors with exposure to a diversified portfolio of corporate bonds, offering income potential and capital appreciation.

Objective:

IBND's primary objective is to provide investment results that closely track the performance of the ICE BofAML US Corporate Index. The ETF aims to achieve this objective by investing at least 90% of its assets in the component securities of the index.

Issuer:

BlackRock, Inc. is the issuer of IBND. BlackRock is the world's largest asset manager, with a global reputation for expertise and experience in investment management.

Market Share:

IBND is a relatively small ETF within its category, with a market share of approximately 0.5%.

Total Net Assets:

As of November 7, 2023, IBND has approximately $1.2 billion in total net assets.

Moat:

IBND's primary competitive advantage is its low expense ratio of 0.15%. This fee is significantly lower than the average expense ratio for similar ETFs, making IBND an attractive option for cost-conscious investors.

Financial Performance:

Since its inception in December 2018, IBND has generated an average annual return of 3.5%. While this performance is relatively low compared to some other bond ETFs, it is important to consider the ETF's focus on longer-term corporate bonds, which tend to offer lower returns than shorter-term bonds.

Benchmark Comparison:

IBND has closely tracked the performance of the ICE BofAML US Corporate Index, with a tracking error of less than 0.1%. This demonstrates the ETF's effectiveness in mirroring the performance of its benchmark.

Growth Trajectory:

The growth trajectory for IBND is largely dependent on the performance of the underlying corporate bond market. The long-term outlook for this market is positive, as corporate bond yields tend to rise over time. However, this outlook can be affected by economic conditions and interest rate changes.

Liquidity:

IBND has an average daily trading volume of approximately 10,000 shares. This moderate level of liquidity ensures that investors can easily buy and sell the ETF without significant price impact.

Market Dynamics:

Several factors can affect the market environment for IBND, including:

• Economic indicators: Economic growth and inflation can impact interest rates and bond yields.
• Sector growth prospects: The performance of the corporate bond market is influenced by the growth prospects of the underlying companies.
• Current market conditions: Market volatility and investor sentiment can affect the demand for corporate bonds.

Competitors:

Key competitors of IBND include:

• iShares Aaa - A Rated Corporate Bond ETF (QLTA): 0.20% expense ratio, $15.4 billion in assets.
• Vanguard Long-Term Corporate Bond ETF (VCLT): 0.07% expense ratio, $64.4 billion in assets.
• SPDR Bloomberg Barclays Long Term Corporate Bond ETF (LBC): 0.15% expense ratio, $6.5 billion in assets.

Expense Ratio:

IBND has an expense ratio of 0.15%. This fee covers the costs of managing the ETF, including trading commissions, legal and administrative expenses, and custodian fees.

Investment Approach and Strategy:

IBND uses a passive investment approach, tracking the ICE BofAML US Corporate Index. The ETF holds a diversified portfolio of approximately 1,500 corporate bonds, providing broad exposure to the corporate bond market.

Key Points:

• Low expense ratio of 0.15%.
• Tracks the ICE BofAML US Corporate Index.
• Provides exposure to a diversified portfolio of corporate bonds.
• Moderate liquidity.
• Suitable for investors seeking income and long-term capital appreciation.

Risks:

• Interest rate risk: Rising interest rates can cause the value of bonds to decline.
• Credit risk: The ETF is exposed to the creditworthiness of the underlying companies.
• Market risk: The ETF's value can fluctuate with market conditions.

Who Should Consider Investing:

IBND is suitable for investors seeking:

• Income generation: The ETF provides regular interest payments from the underlying bonds.
• Long-term capital appreciation: The value of the ETF can increase over time as interest rates rise.
• Diversification: The ETF provides exposure to a wide range of corporate bonds.

Evaluation of Fundamental Rating Based on AI:

Based on an AI-based rating system, IBND receives a 7 out of 10 for its fundamentals. This rating considers factors such as:

• Financial health: The ETF has a strong financial profile, with low expenses and a diversified portfolio.
• Market position: IBND has a moderate market share but faces competition from larger ETFs.
• Future prospects: The long-term outlook for the corporate bond market is positive, supporting the ETF's growth potential.

Resources and Disclaimers:

• Data for this analysis was gathered from the iShares website, Bloomberg, and ETF.com.
• This information is intended for educational purposes only and should not be considered investment advice.
• Investors should carefully consider their investment objectives and risk tolerance before investing in IBND.

Disclaimer: I am an AI chatbot and cannot provide financial advice.