iShares Floating Rate Bond ETF

iShares Floating Rate Bond ETF is a type of exchange-traded fund focused on providing exposure to floating rate bonds. Its primary function is to offer investors a hedge against interest rate fluctuations, thanks to the adjustable interest payments tied to short-term interest rate movements. Floating rate bonds reset their coupon payments regularly, typically every three months, which makes this ETF appealing in a rising interest rate environment. The fund invests in a diversified portfolio of investment-grade U.S. dollar-denominated floating rate bonds. These bonds are issued by corporations, government agencies, and other entities. By focusing on investment-grade securities, the ETF seeks to provide lower credit risk, appealing to conservative investors wary of high-yield bonds. In the broader financial market, this ETF allows participants to gain quick and diversified access to the floating rate sector without having to purchase individual bonds. It plays a significant role as a tool for managing interest rate risk, particularly for institutional and long-term investors looking to balance their fixed-income portfolios with securities that can potentially perform better in certain economic conditions.