US ETF investors favour shorter tenor bonds as interest rate risks rise
TLT•Inflows favor short and intermediate funds
Japan's 10-year government bond yield JP10YT=RR hit above 3% for the first time in three decades this month, while U.S. Treasury yields are near three-year highs and German and British borrowing costs are at multi-year peaks.
Short U.S. Treasury exchange-traded funds drew $12.2 billion in the 20 trading sessions through September 8, while intermediate-maturity bond ETFs attracted about $5.7 billion over the same period, according to LSEG Lipper.
The inflows into shorter-term bonds amounted to more than a fifth of the $58 billion those funds have attracted so far this year.
Morningstar data showed U.S. intermediate core bond ETFs received $54.2 billion in net inflows through August, while short-term bond ETFs attracted $25.3 billion. Long-term bond ETFs drew just $2.5 billion over the same period.
