Summer Rally One Month Old, What ETFs Are Investors Turning To?

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August 12, 2009 10:49am ETF BASIC NEWS NYSE:LQD

where2Many investors are skeptical about whether the rally has legs, reports CNBC’s Rebecca Jarvis.  Rebecca says that fixed income ETFs are attracting allot of new investor energy with people trying to mitigate downside risk and protect against inflation. She focuses on


 the iShares iBoxx $ Invest Grade Corp Bond ETF (LQD), and the iShares Barclays TIPS Bond ETF (TIP). See the CNBC video below

The iShares iBoxx $ Invest Grade Corp Bond (LQD) seeks investment results that correspond generally to the price and yield performance of a segment of the U.S. investment-grade corporate bond market as defined by the iBoxx $ Liquid Investment-Grade index. The fund typically invests at least 90% of assets in the bonds of the underlying index, and at least 95% of assets in investment grade corporate bonds. It may also invest in bonds not included in the underlying index. The fund may also invest up to 5% of assets in repurchase agreements collateralized by U.S. government obligations, and in cash and cash equivalents. It is nondiversified.

The iShares Barclays TIPS Bond (TIP) seeks results that correspond generally to the price and yield performance of the inflation-protected sector of the United States Treasury market as defined by the Barclays Capital U.S. TIPS index. The fund invests at least 90% of the assets in the inflation-protected bonds of its underlying index and at least 95% if the assets in U.S. government bonds. It may also invest up to 10% of assets in U.S. government bonds not included in the underlying index. The fund invests up to 5% of assets in repurchase agreements collateralized by U.S. government obligations and in cash and cash equivalents.


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