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Investment Grade Corp Bond ETF (LQD) Hits New 52-Week High

Sanghamitra Saha
·2 min read

For investors seeking momentum, iShares IBoxx $ Investment Grade Corporate Bond ETF LQD is probably on the radar now. The fund just hit a 52-week high and is up about 14.6% from its 52-week low price of $115.42/share.

But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:

LQD in Focus   

The fund looks to track the Markit iBoxx USD Liquid Investment Grade Index. It is a rules-based index consisting of liquid, U.S. dollar denominated, investment-grade corporate bonds for sale in the United States. Weighted Average Maturity and Effective Duration of the fund are 13.29 years and 9.27 years. The fund charges 15 bps in fees and yields 3.17% annually (see: all Investment Grade Corporate Bond ETFs here).

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Why the Move?

The fixed-income world has been an area to watch lately as investors are flocking to safe havens amid coronavirus scare that could derail the global economic growth. The number of confirmed cases has increased outside China. The flight-to-safety brought down U.S. benchmark treasury yields at extremely low levels. This, in turn, probably brightened the demand for this investment grade corporate bond ETF that is yielding 3.17% annually as well as has lesser chances of default.

More Gains Ahead?

The fund has a Zacks ETF Rank # 2 (Buy). The ETF has a positive weighted alpha of 13.70, which gives cues of further rally.

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iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD): ETF Research Reports
 
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