Is Fixed Income ETF Sentiment Shifting?

We are focusing a lot of attention on fixed income at VettaFi in October. This week, we are hosting webcasts with AllianceBernstein and State Street Global Advisors. We also have an Income Strategy Symposium with 11 asset management partners. These 20-minute discussions will be taking place over two-plus hours. We believe interest in the asset category remains high, but that fixed income sentiment could be shifting.

What Does the Data Indicate to Us?

VettaFi and our clients can use a robust dataset, called Explorer, to understand what asset classes, categories, and areas of focus are resonating with our audience. This is helpful for spotting trends and helping asset managers understand what products are in focus.

In the screenshot below from Explorer using data since July, note the teal bars (corporate broad-based) in the middle of the chart. They became larger than the green bars (government-Treasuries) at the bottom of the chart.

Interest in U.S. Corporate Bonds Rising in Favor of Treasury Bonds

A Closer Look at Fixed Income Flows

Looking back over the past month, demand has been strongest for high-quality safe-haven ETFs. Ultra-short ETFs like the SPDR Bloomberg 1-3 Month T-Bill ETF (BIL) and iShares Short Treasury Bond ETF (SHV) were among the most popular according to VettaFi’s LOGICLY data. BIL and SHV added $4.0 billion and $1.9 billion of new money as of October 19, respectively. Meanwhile, the iShares 20+ Year Treasury ETF (TLT) matched its much-less-rate-sensitive sibling SHV in flows.