Investors Pour $10.4B into Taxable Bond ETFs, Favoring Short-Term Treasuries

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Weekly Channel Summary

The Taxable Fixed Income channel encompasses 722 ETFs from 149 issuers, with total assets under management standing at $2.38 trillion. Investors added a net $10.4 billion to the channel over the past week, contributing to a year-to-date inflow of $381.9 billion. Over the last twelve months, the channel has attracted a total of $534.4 billion in new assets.

This Week’s Performance Leaders and Laggards

Long-Term Taxable bonds led performance this week, gaining 0.87% as a category. On the other end of the spectrum, Convertible bonds were the worst performers, declining by 1.30%. Despite the weekly drop, the Convertible category remains the top performer year-to-date with a gain of 16.50%, highlighting a divergence between short-term and long-term trends.

Category Performance Snapshot

Category WTD 1 Month 3 Month 6 Month YTD 1 Year
Taxable – Long-Term 0.87% -0.30% -2.40% -4.13% -1.57% 0.49%
Taxable – Government Long 0.66% -0.90% -1.66% -5.48% -1.98% -0.24%
Taxable – Bank Loans 0.24% 1.13% 1.79% 4.84% 2.58% 4.78%
Taxable – Preferred Stock 0.23% 0.69% -1.02% -0.36% 1.53% 2.81%
Taxable – Corporate 0.19% 0.00% -0.85% -1.84% -0.33% 1.77%
Taxable – Emerging USD 0.17% 0.24% -0.07% -0.31% 1.68% 5.94%
Taxable – Core Enhanced 0.12% -0.01% -0.41% -1.66% 0.15% 2.23%
Taxable – Core 0.11% -0.10% -0.51% -1.93% -0.12% 1.80%
Taxable – High Yield 0.11% 0.93% 1.02% 1.96% 2.58% 4.73%
Municipal – Single State 0.06% 0.48%
Taxable – Securitized 0.06% -0.11% -0.40% -1.61% 0.42% 3.08%
Taxable – Government Ultrashort 0.06% 0.34% 0.94% 1.81% 2.39% 3.83%
Taxable – Ultrashort 0.05% 0.41% 1.02% 1.95% 2.61% 4.29%
Taxable – Multisector -0.01% 0.38% 0.47% 0.27% 1.59% 3.81%
Taxable – Government Intermediate -0.08% -0.18% -0.37% -2.18% -0.54% 0.88%
Taxable – Short-Term -0.09% 0.27% 0.39% 0.09% 1.06% 2.75%
Taxable – International USD -0.09% -0.52% -0.57% -1.65% 0.29% 1.11%
Taxable – Government Short -0.13% 0.26% 0.46% 0.22% 0.97% 2.48%
Taxable – Inflation Protected -0.21% 0.14% -0.57% -0.10% 1.23% 1.51%
Taxable – International -0.64% 1.57% -0.86% -2.78% -0.39% -0.02%
Taxable – Emerging -0.76% 1.40% 1.76% -0.37% 2.77% 6.80%
Taxable – Convertible -1.30% 2.30% -4.66% 9.64% 16.50% 21.84%

Top & Bottom 5 ETFs by Weekly Performance

Reflecting the strength in long-duration assets, the PIMCO 25+ Year Zero Coupon US Treasury Index Exchange-Traded Fund (ZROZ) was the top-performing fund with a 2.26% gain. Conversely, the iShares Convertible Bond ETF (ICVT) posted the largest loss, falling 1.39% for the week. This fund’s performance was in line with the broader weakness seen across the Convertible bond category.

Ticker Fund Name WTD Performance
Top Performers
ZROZ PIMCO 25+ Year Zero Coupon US Treasury Index Exchange-Traded Fund 2.26%
GOVZ iShares 25+ Year Treasury STRIPS Bond ETF 2.01%
DWWN Principal Long Duration ETF 1.98%
EDV Vanguard Extended Duration Treasury ETF 1.93%
MBSX Regan Fixed Rate MBS ETF 1.82%
Bottom Performers
ICVT iShares Convertible Bond ETF -1.39%
CVRT Calamos Convertible Equity Alternative ETF -1.36%
CWB State Street SPDR Bloomberg Convertible Securities ETF -1.19%
TUA Simplify Short Term Treasury Futures Strategy ETF -1.18%
MCVT Miller Convertible Total Return ETF -1.15%

Analyzing the Weekly Flows

Taxable bond ETFs saw net inflows of $10.4 billion, with investors showing a clear preference for shorter-duration assets. The Multi-Sector and Government segments were the primary beneficiaries, attracting $4.3 billion and $4.2 billion, respectively. A breakdown by duration reveals that Short and Ultrashort strategies collected a combined $11.5 billion, while Intermediate and Long duration funds experienced net outflows.

Flows by Segment

Segment Fund Count AUM 5 Day 30 Day 90 Day YTD 1 Year
Multi-Sector 304 $995.71B $4,323M $22,446M $67,538M $170,145M $248,607M
Government 133 $739.91B $4,221M $20,867M $43,497M $134,662M $184,394M
Securitized 46 $110.12B $941M $1,778M $4,660M $9,639M $11,901M
Bank Loans 50 $72.39B $480M $2,940M $6,927M $14,848M $16,048M
Corporate 158 $415.13B $357M $6,332M $24,331M $49,539M $69,150M
Preferred Stock 30 $43.31B $55M $84M $1,715M $2,992M $4,245M
Cat Bonds 1 $96M $7M $13M $16M $60M $83M

Flows by Credit Type

Credit Type Fund Count AUM 5 Day 30 Day 90 Day YTD 1 Year
Credit: Investment Grade 373 $1,897.59B $8,803M $43,438M $110,203M $304,023M $414,364M
Credit: Blend 192 $280.64B $1,465M $8,201M $28,241M $63,930M $94,662M
Credit: High Yield 153 $198.06B $108M $2,774M $10,094M $13,700M $25,061M
Specialty: Interest Rate Volatility 1 $93M $0M $5M $38M $73M $73M

Flows by Duration

Duration Fund Count AUM 5 Day 30 Day 90 Day YTD 1 Year
Duration: Short 91 $315.57B $7,677M $12,864M $22,666M $51,380M $67,689M
Duration: Ultrashort 149 $511.24B $3,878M $19,054M $42,560M $128,589M $155,107M
Duration: Long 62 $196.82B -$472M $1,433M $4,669M $7,240M $20,143M
Duration: Intermediate 417 $1,352.75B -$707M $21,068M $78,680M $194,517M $291,222M

Top & Bottom 5 ETFs by 5-Day Flow

The Vanguard Short-Term Treasury ETF (VGSH) led all funds, pulling in a substantial $3.7 billion in new assets. In contrast, investors shed exposure to intermediate-term government debt. The Vanguard Intermediate-Term Treasury ETF (VGIT) and the iShares U.S. Treasury Bond ETF (GOVT) experienced the largest redemptions, with each seeing outflows of approximately $2.6 billion.

Ticker Fund Name 5-Day Flow
Inflows
VGSH Vanguard Short-Term Treasury ETF $3,669M
SCHO Schwab Short-Term US Treasury ETF $1,753M
SPTS State Street SPDR Portfolio Short Term Treasury ETF $1,133M
SGOV iShares 0-3 Month Treasury Bond ETF $911M
VCIT Vanguard Intermediate-Term Corporate Bond ETF $788M
Outflows
VGIT Vanguard Intermediate-Term Treasury ETF -$2,647M
GOVT iShares U.S. Treasury Bond ETF -$2,629M
IEF iShares 7-10 Year Treasury Bond ETF -$1,026M
HYG iShares iBoxx $ High Yield Corporate Bond ETF -$597M
LQD iShares iBoxx $ Investment Grade Corporate Bond ETF -$447M

Issuer League Table Update

iShares and Vanguard continue to dominate the taxable bond landscape, commanding 36.05% and 26.25% of the market share, respectively. Vanguard was the week’s biggest asset gatherer, attracting nearly $3.9 billion in net inflows. Conversely, iShares experienced the largest outflows among all issuers, with investors pulling a net $1.6 billion from its funds.

Top 5 Issuers by AUM

Brand Fund Count AUM AUM Market Share
iShares 87 $856.84B 36.05%
Vanguard 31 $623.93B 26.25%
SPDR 36 $176.29B 7.42%
JPMorgan 20 $99.05B 4.17%
Schwab 12 $80.37B 3.38%

Top & Bottom 3 Issuers by 5-Day Flow

Brand 5-Day Flow
Inflows
Vanguard $3,899M
Schwab $1,832M
SPDR $1,621M
Outflows
iShares -$1,573M
Simplify -$147M
3Edge -$29M

For a deeper dive into these trends, access our FREE, in-depth Taxable ETF reports in the right side panel of this page.

Disclosures

This material is for informational purposes only and should not be considered investment advice. All investments, including ETFs, involve risk, including the possible loss of principal. Investors should consider their investment objectives, risks, charges, and expenses carefully before investing.

This analysis was developed by the team at ETF Action. We leverage advanced AI tools to assist in the drafting and refinement of our content, based on our expert prompts, direction, and final review.