ProShares Rolls Out Short Duration EM Bond ETF

ETF Trends

ProShares, the largest issuer of inverse and leveraged exchange traded funds, continues to expand its lineup of traditional ETFs with Thursday’s debut of the ProShares Short Term USD Emerging Markets Bond ETF (EMSH).

EMSH “tracks the DBIQ Short Duration Emerging Market Bond Index, which is composed of a diversified portfolio of U.S. dollar-denominated emerging markets bonds with a weighted average maturity of three years or less. The index currently includes bonds from 19 countries issued by sovereign governments, other government entities and agencies, as well as corporations that have significant government ownership. A country’s weight in the index is capped at 10%. Bonds must have a minimum $500 million outstanding issuance to be eligible,” according to a statement by ProShares.

The new ETF’s top five country weights are Ukraine, Russia, Turkey, Brazil and Indonesia and combine for over 47% of the fund’s weight.

A case can be made EMSH’s is well-timed because although 10-year Treasury yields have recently ebbed lower, investors are still pouring cash into low duration bond ETFs. [New Junk Bond ETF Merits Attention]

The new fund is designed to offer attractive yield potential with reduced interest rate sensitivity, potentially making it a compelling option for income investors looking for exposure to international bonds.

EMSH has annual fees of 0.5%. Recent additions to the ProShares lineup of non-leveraged ETFs include the ProShares Investment Grade—Interest Rate Hedged (IGHG) and the ProShares S&P 500 Aristocrats ETF (NOBL) . [Nine New Dividend ETFs With Staying Power]

EMSH Country Weights

View photo

.

emsh

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.

View Comments