ETF Spotlight on the FlexShares Disciplined Duration MBS Index Fund (MBSD) , part of an ongoing series.
Assets : $5.0 million
Objective : The FlexShares Disciplined Duration MBS Index Fund tries to reflect the performance of the BofA Merrill Lynch Constrained Duration US Mortgage Backed Securities Index, which tracks mortgage-backed securities but also hedges against interest rate risk.
Holdings : Top holdings include TBA GNMA 6.0% 30 YRS Dec 4.7%, FHLMCGLD Mortpass 6.0% April 2039 3.2%, FNMA Mortpass 4.5% Nov. 2018 3.1%, Federal National Mortgage Assoc 3.5% mortgage bonds 3.1% and FHLMCGLD Mortpass 5% July 2020 2.9%.
What You Should Know :
- Northern Trust’s FlexShares sponsors the ETF.
- MBSD has a 0.20% expense ratio.
- The fund has 60 holdings and the top ten components make up 30.4% of the overall portfolio.
- MBSD’s top issuers include Federal National Mortgage Association 40.4%, Government national Mortgage Association 32.1% and Federal Home Loan Mortgage Corporation 26.1%.
- The fund includes 66.5% agency bonds and 33.5% government bonds.
- The fund began trading September 3, 2014.
- MBSD is up 0.2% over the past week and down 0.1% over the past month.
- The ETF has a 1.62% 30-day SEC yield and a 3.3 year effective duration.
- The underlying index may include 30-year, 20-year and 15-year fixed rate residential mortgage pass-through securities, the index provider’s methodology will adjust holdings to achieve a 3.25 to 4.25 year duration.
- Potential investors should use limit orders as the ETF is relatively new and shows an average daily volume of about 9,700 shares.
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