Two ETFs to Consider Inflation for Protection With Targeted Duration etftrends.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from etftrends.com Daily Mail and Mail on Sunday newspapers.
Getting a combination of targeted duration combined with inflation protection is possible via the FlexShares iBoxx 3-Year Target Duration TIPS Index Fund (TDTT) and the FlexShares iBoxx 5-Year Target Duration TIPS Index Fund (TDTF).
When Using TIPS ETFs, Keep It Short and Sweet May 21, 2021
With so much talk about possible increases in the Consumer Price Index (CPI), it’s not surprising advisors and investors are revisiting a popular inflation-fighting asset class: Treasury inflation protection securities (TIPS).
Something that often goes overlooked with TIPS is duration risk. That stands to reason because credit risk is non-existent. Another element to consider is that TIPS’ durations are often fluid as they’re levered to changing inflation expectations.
A way for investors to contend with near-term inflation while reducing rate risk is by minimizing duration. Enter the
“Duration, is a key measure of a bond’s sensitivity to interest rate changes, and TIPS’ durations can change frequently with changing inflation expectations. The reason for this is future cash flows, a key determinant of duration, are driven by inflation expectation,” according to FlexShares research.
Inflation Is Coming These TIPS ETFs Aren t Fazed etftrends.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from etftrends.com Daily Mail and Mail on Sunday newspapers.