Nuveen, begun trading a new US Fixed Income ETF, the NuShares Enhanced Yield 1-5 Year U.S. Aggregate Bond ETF (NyseArca: NUSA), on Monday, April 03, 2017. Here is a synopsis of the new ETF:
|Symbol: NUSA||Exchange: NYSE ARCA|
|Name: NuShares Enhanced Yield 1-5 Year U.S. Aggregate Bond ETF||Net Expense Ratio: 0.20%|
The NuShares Enhanced Yield 1-5 Year U.S. Aggregate Bond ETF seeks to track the investment results, before fees and expenses, of the BofA Merrill Lynch Enhanced Yield 1-5 Year US Broad Bond Index.
The BofA Merrill Lynch Enhanced Yield 1-5 Year US Broad Bond Index is designed to broadly capture the 1-5 year U.S. investment grade fixed income market, as represented by a modified version of the BoA Merrill Lynch 1-5 Year US Broad Market Index (the Base Index).
Unlike the Base Index, the Enhanced Index does not weight component securities by market capitalization. Instead, the Enhanced Index first assigns component securities from the Base Index into a variety of categories based upon asset class, sector, credit quality and maturity. The Enhanced Index then employs a rules-based methodology to allocate higher weights to categories with higher yields than the Base Index while seeking to maintain risk and credit quality at levels similar to those of the Base Index by limiting the amount of deviation between the two indices with respect to sector and category weights, tracking error and duration. After the Enhanced Index assigns a weight to each category (negative weights for a category are not permitted), individual component securities within each category are weighted based on their relative market capitalization. The Base Index and Enhanced Index are both rebalanced on a monthly basis.
The Enhanced Index draws from the universe defined by the Base Index, which consists of U.S. dollar-denominated, investment grade taxable debt securities with a remaining term to final maturity, or an average life, of less than 5 years. Qualifying securities must also have at least one year until final maturity, at least 18 months to final maturity at point of issuance and a fixed coupon schedule. The Enhanced Index is principally comprised of U.S. government securities (securities issued or guaranteed by the U.S. government or its agencies or instrumentalities), debt securities issued by U.S. corporations, residential and commercial mortgage-backed securities, asset-backed securities, and U.S. dollar denominated debt securities issued by non-U.S. governments and corporations that are publicly offered for sale in the United States.
Top Holdings (03/31/17):
|US TREAS NTS 1.125% 02/28/19||7.8%|
|US TREAS NTS 1.375% 02/15/20||5.7%|
|US TREAS NTS 1.625% 03/15/20||5.4%|
|COMM 2015-CR22 A2||4.5%|
|AMCAR 2015-2 B||3.3%|
|JPMBB 2015-C28 A2||2.3%|
|GOLDMAN SACHS 5.375% 03/15/20||1.8%|
|US TREAS NTS 1.875% 02/28/22||1.8%|
|JPM 4.5% 01/24/22||1.7%|
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