Investors Piling into Bond ETFs

More and more investors have been moving money into Bond ETFs according to WSJ reporter John Spence.

In the article, Bond ETFs Draw a Surge of Funds, Spence reports that the two best selling fixed income ETFs in the iShares line-up are bond funds. In fact, the iShares iBoxx $ Investment Grade Corporate Bond Fund (LQD) has seen net inflows of nearly $5 billion.

Junk bond ETFs have also done well including the iShares iBoxx $ High Yield Corporate Bond Fund (HYG) and the SPDR Barclays Capital High Yield Bond ETF (JNK).

Spence also points out that inflation fears flamed by loose monetary policy and unprecedented government spending have investors putting money into Treasury Inflation Protected Securities or TIPS. For example, the iShares Barclays TIPS Bond Fund (TIP) has doubled in 2009.

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