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TIPS ETF (IPE) Hits New 52-Week High

Sweta Killa

For investors seeking momentum, SPDR Barclays TIPS ETF IPE is probably on their radar now. The fund just hit a 52-week high, and is up 4.7% from its 52-week low price of $54.36/share.

But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:

IPE in Focus

This fund offers protection against the intermediate-term inflation with weighted maturity of 9.39 years and modified duration of 7.00 years. Holding 38 securities in its basket, TIPS focuses on top-rated bonds with AAA credit ratings, suggesting no default risk. The product charges 15 bps in annual fees (see: all the Inflation-Protected Bond ETFs here).

Why the Move?

The Treasury Inflation-Protected Securities (TIPS) corner of the bond market has been an area to watch lately given the fact that the cost of living in the U.S. has started to rise. This is especially true as consumer prices rose 0.4% in April, reflecting the largest increase in more than three years. This is higher than the market expectation of 0.3% gain and a 0.1% rise seen in March. In order to combat inflationary fears, investors have switched to products that could benefit from a bout of inflation.

More Gains Ahead?

It seems that IPE might remain strong given a weighted alpha of 2.10% and a lower 20-day volatility of 5.13%. As a result, there is still some promise for investors who want to ride on this surging ETF a little further.

 

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SPDR-BC TIPS (IPE): ETF Research Reports
 
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