iShares Treasury Floating Rate Bond ETF (TFLO) at a 52-week high


the iShares Floating Rate Treasury Bond ETF TFLO is probably a suitable choice for investors looking for momentum. TFLO hit a 52-week high and is up from its 52-week low of $50.25/share.

Let’s take a look at TFLO and its near-term outlook to gauge where it might be headed.

TFLO in a nutshell

The iShares Treasury Floating Rate Bond ETF seeks to track the investment results of an index composed of floating rate US Treasury bonds. It has an AUM of $472.8 million and charges an expense ratio of 15 basis points.

Why the move?

Given the persistently high inflation figures, the central bank has already started to scale back its bond purchases, which it expects to complete by March. The Fed is expected to start raising its benchmark interest rate in March. The Federal Reserve could take a more aggressive approach by raising interest rates. In fact, Goldman Sachs expects the Federal Reserve to raise interest rates seven times this year, according to a CNBC article.

This has increased the appeal of floating rate bonds. The coupons of these bonds being adjusted periodically, they are less sensitive to a rise in rates compared to traditional bonds. This makes funds like TFLO an impressive investment option.

More wins to come?

It looks like the iShares Treasury Floating Rate Bond ETF will remain strong, with a positive weighted alpha of 0.13, giving hints of a further rally.

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iShares Treasury Floating Rate Bond ETF (TFLO): ETF Research Reports

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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