Financial Powerhouses Launch New Income-Focused ETFs

On Thursday, top financial players BlackRock and J.P.Morgan each launched a new ETF to add to their ever-growing fund libraries.

BlackRock’s Expansive Bond Coverage

BlackRock added the iShares Total USD Fixed Income Market ETF (BTOT) to its suite of ETF solutions. The fund’s goal is to provide results similar to that of the Bloomberg US Total Fixed Income Market Index. Following a fee waiver, the fund has a net expense ratio of nine basis points.

This Bloomberg index takes a broader perspective on bonds, looking to sectors that tend to get excluded from traditional multi-sector fixed income indices. This includes financial sectors like bank loans, floating rate notes, and inflation-linked securities, among others.

Given BTOT’s wide sector berth, the fund could work well as a great bedrock piece for a fixed income portfolio. By taking on this fund, investors can both diversify their fixed income portfolio while continuing to foster yield and long-term results.

“Bond markets have evolved dramatically over the years, and investors need tools that keep pace with this change,” said Steve Laipply, Global Co-Head of iShares Fixed Income ETFs. “BTOT offers a single, convenient way to access this broader opportunity set, helping investors tap into some of the most attractive areas in fixed income today and build well-diversified portfolios.”

J.P.Morgan Targets U.S. Treasuries

Meanwhile, J.P.Morgan debuted the JPMorgan 100% U.S. Treasury Securities Money Market ETF (JMMF). JMMF aims to provide strong current income while maintaining both liquidity and a low volatility of principal. The fund’s net expense ratio sits at 16 basis points.

True to its name, JMMF looks to focus its investments in U.S. Treasury debt securities. This includes financial securities like Treasury bills, bonds, and notes.

Despite only charging 16 basis points, JMMF is an actively-managed fund. This factor could prove to be especially attractive to investors who are seeking to expand their income-generating capabilities, especially when bolstered by the flexibility of active management.

“JMMF gives investors a straightforward way to access U.S. Treasury Securities while benefiting from the convenience and transparency of the ETF structure,” added John Donohue, CEO of J.P.Morgan Asset Management Americas and Head of the Global Liquidity business within Asset Management. “Our decades of experience managing Treasury strategies, combined with the ETF format, enable us to deliver a product that meets the evolving needs of investors seeking security, flexibility, and transparency in their cash management.”