BlackRock Bond Fund Hits 12-Month Low as Yields Rise
BlackRock's iShares iBoxx $ Investment Grade Corporate Bond ETF has dropped to $106.74, its lowest level in over a year, as the effective yield on the ICE BofA U.S. Corporate Index continues to rise.
Key Numbers
BlackRock's $35 billion iShares iBoxx $ Investment Grade Corporate Bond ETF (ticker: BLK) has fallen to $106.74, a level not seen in more than a year, according to Barron's. The fund tracks a broad swath of U.S. investment-grade corporate bonds.
Reasons for the Move
The decline in the fund's price is driven by a rising effective yield on the ICE BofA U.S. Corporate Index, a benchmark for investment-grade corporate bonds. As yields rise, bond prices fall, reducing the fund's net asset value.
Context
Bond markets have been under pressure recently due to expectations of further Federal Reserve rate hikes. This move in BlackRock's fund reflects a broader trend in the investment-grade bond market.
Similar Moves in the Sector
Other investment-grade bond ETFs are likely experiencing similar declines as yields continue to climb. Investors are closely watching inflation data and Fed guidance for future direction.
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