iShares Interest Rate Hedged Emerging Markets Bond ETF plans launch

By Toni Weeks

San Luis Obispo, Calif., Dec. 6 - iShares announced that it plans to launch the iShares Interest Rate Hedged Emerging Markets Bond ETF, according to an N-1A filing with the Securities and Exchange Commission.

The fund will seek to mitigate the interest rate risk of a portfolio composed of dollar-denominated, emerging market bonds. Under normal circumstances, it will invest at least 80% of its net assets in its portfolio, in one or more underlying funds that principally invest in emerging market bonds and in U.S. Treasury securities.

According to the filing, at inception the fund intends to initially invest a substantial portion of its assets in one underlying fund, the iShares J.P. Morgan USD Emerging Markets Bond ETF.

The fund will attempt 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 will be the portfolio managers.

The management fee and ticker symbol have not yet been determined.

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

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