BlackRock launches iShares Interest Rate Hedged 10+ Year Credit Bond

By Toni Weeks

San Luis Obispo, Calif., June 8 – iShares announced it has launched the iShares Interest Rate Hedged 10+ Year Credit Bond ETF, according to an N-1A filing with the Securities and Exchange Commission.

The fund seeks to mitigate the interest rate risk of a portfolio composed of investment-grade U.S. corporate bonds and dollar-denominated bonds, including those of non-U.S. corporations and governments, with remaining maturities greater than 10 years. Under normal circumstances, it invests at least 80% of its net assets in its portfolio, in one or more underlying funds that principally invest in investment-grade bonds and in U.S. Treasury securities.

According to the filing, at inception the fund will invest a substantial portion of its assets in one underlying fund, the iShares 10+ Year Credit Bond ETF.

The fund attempts to mitigate the interest rate risk of the underlying securities primarily through the use of U.S. Treasury futures contracts and may also invest in other interest-rate futures contracts, including eurodollar and Federal Funds futures.

James Mauro and Scott Radell are the portfolio managers.

The shares trade on the NYSE Arca under the symbol “CLYH.”

There are no shareholder fees. Including management fees of 0.35% and taking into account the effects of a fee waiver agreement with the investment adviser, total annual fund operating expenses are expected to be 0.3%.

San Francisco-based BlackRock Fund Advisors will be the investment adviser.

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