FIXED INCOME ETFs

Learn more about how iShares fixed income ETFs can help you manage risk, enhance yield, and navigate Asia’s evolving markets.

Man standing in front of waterfall

UNDERSTANDING FIXED INCOME ETFs

Fixed income ETFs – or bond ETFs – provide exposure to diversified baskets of bonds—ranging from government and investment-grade corporates to high yield and emerging markets, combining the transparency and liquidity of equities with the income-generating potential of bonds.

Today, bond ETFs have transformed the way institutional investors manage fixed income. What was once a fragmented, over-the-counter market is today a highly accessible and efficient way for institutional investors to access fixed income markets.

BlackRock believes that global bond ETFs are well positioned to reach US$6 trillion by the end of 20301.

Thematic Exposures include:

  • iBonds ETFs
  • BuyWrite ETFs
  • Active ETFs
  • Rate / Inflation Hedged ETFs
23

Number of years since launching the first bond ETFs in 20022
350

More than 350 iShares bond ETFs listed globally2
1

Total iShares bond ETF AUM (~40% of global AUM), in USD2
19

In active bond ETF assets managed by iShares, in USD2
55

Market share in industry-wide target maturity bond ETFs2

CASE STUDIES

Potentially enhance yield without excess credit risk

An institutional investor with a USD-denominated portfolio sought to enhance yield, while only modestly increasing credit risk. The portfolio manager was willing to consider expanding the credit universe to achieve their goal.   

The portfolio manager purchased a USD-denominated investment grade corporate bond ETF, which included several benefits:

  • Higher yield relative to base government market
  • Diversified investment of more than 2500 securities
  • Ease of execution
  • On-exchange liquidity

Upon review of this investment, the investment committee recognized that gaining exposure to the asset class did not expose the portfolio to individual security risk. It also allowed a lower minimum credit rating tolerance for an index exposure. While a security default would still affect the value of the index, it would be partially mitigated by name diversification in the index.

Balancing investment performance with liquidity management

A portfolio manager must balance cash flow needs, while simultaneously maintaining exposure and limiting the effects of cash drag. With rising interest rates and wider credit spreads increasing the cost of funding, a reduction in new bond issuance volumes can challenge liquidity for investors. Therefore, the portfolio manager prefers to use a cash sleeve for liquidity management instead of frequently buying and selling individual bonds. However, employing such a strategy can lead to performance drag.

Investors can use bond ETFs, in both stressed and less volatile market environments to replicate a liquid version of the broader portfolio.  

ETFs allowed the portfolio manager to achieve a low-cost exposure without incurring the cash drag of uninvested assets.

FIXED INCOME INSIGHTS

EMERGING ON TOP

Nov 01, 2025 | iShares

In November’s Asia FIX, we turn our attention to Emerging Markets Debt, whose stellar performance has quietly slipped under the radar.

IN THE DRIVER’S SEAT WITH BOND ETFs

Oct 01, 2025 | iShares

In October’s Asia FIX, we ask investors to get in the driver’s seat, take the wheel with bond ETFs, and ride out the bumpy curve with confidence.

WHEN CASH IS KING, BONDS STILL RULE

Sep 01, 2025 | iShares

In September’s Asia FIX, we highlight three potential options investors can consider ahead of further rate cuts, ranging from vanilla to more niche exposures.

A CLOser LOOK AT CLOs

Aug 01, 2025 | iShares

For investors looking to step out of cash, AAA CLOs present a compelling opportunity for uncorrelated income opportunities while maintaining a low risk profile.

HUNTING FOR TREASUR(IES)

Jun 01, 2025 | iShares

Tariff uncertainty drives markets—explore global diversification and the potential of high-quality global government bonds.

A MONTH AFTER LIBERATION

May 01, 2025 | iShares

Market volatility eased since April’s tariff shock, but trade tensions persist. We explore how EUR bonds can boost portfolios amid USD weakness.

THE BONDS OF LIBERATION

Apr 01, 2025 | iShares

Trump’s “Liberation Day” tariffs jolted markets again. We explore fixed income opportunities and bond ETFs to help investors navigate tariff impacts.

QUALITY THE WAY YOU WANT IT

Mar 01, 2025 | iShares

Amid market noise, IG bond ETFs quietly thrived, posting monthly inflows all last year and ranking as 2024’s 3rd fixed income flow gatherer.

SNAKES AND (BOND) LADDERS

Feb 01, 2025 | iShares

Fixed income markets in January could be likened to the game of snakes and ladders – while returns were broadly positive, this was not without much volatility.
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