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Corporate Bond ETF (IGEB) Hits New 52-Week High

Sweta Jaiswal, FRM

For investors looking for momentum, iShares Edge Investment Grade Enhanced Bond ETF IGEB is probably a suitable pick. The fund just hit a 52-week high and is up roughly 12.6% from its 52-week low price of $46.85/share.

But does this ETF have more gains in store? Let’s take a look at the fund and its near-term outlook to gain insight into where it might be headed:

IGEB in Focus

The fund seeks to match the investment results of BlackRock Investment Grade Enhanced Bond Index. The index comprises of U.S. dollar-denominated, investment-grade corporate bonds. The fund delivers higher returns by combining two diversifying factors — quality and value. IGEB is charging 18 bps in fees. The fund has amassed $78.7 million in AUM.

Why the Move?

The uncertainty in market conditions due to geo-political tensions, slowdown in the global economic growth and escalating Sino-US trade war tensions are increasingly adding to the appeal of safe-haven picks like investment-grade corporate bonds.

More Gains Ahead?

Given the uncertainty in current market conditions, it is hard to get a handle on the fund’s future returns one way or the other. However, it seems that IGEB might remain strong given a positive weighted alpha of 10.9.

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iShares Edge Investment Grade Enhanced Bond ETF (IGEB): ETF Research Reports
 
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