FLOT ETF

A rise in Treasury yields is likely to benefit a few corners of the stock and bond market.

iShares Floating Rate Bond ETF is nice to avoid duration risk while benefiting from higher short-term yields amid volatile interest rates. Inflation declines are helped by lower oil prices, and sustained rate cuts are less likely in our view due to ongoing price increases by companies. We think the main chance for victory in the inflation battle is if the slightly lower oil and gas prices shift expectations, which are a persistent anchor above target rates.

The iShares Floating Rate Bond ETF is a low Beta, high quality, liquid ETF suitable for most short-term investors. It is designed to preserve wealth, not build it. The high-quality FRNs that FLOT invests in earn a premium yield to T-Bills, despite the fact that they are of similar credit quality. FLOT should continue to outperform money market instruments because the spreads it is locking in today will likely exceed the spreads on offer in a few years' time.

The FLOT ETF provides exposure to floating rate investment-grade bonds. The FLOT ETF has delivered a respectable 8.8% total return since April 2023 with a 5.9% yield. Revisiting my credit investment outlook, I believe following objective indicators like high-yield credit spreads may allow investors to stay invested for longer.

For investors seeking momentum, iShares Floating Rate Bond ETF FLOT is probably on the radar. The fund just hit a 52-week high and is up 1.3% from its 52-week low price of $50.45/share.

The iShares Floating Rate Bond ETF has shown strong performance in a prolonged period of higher interest rates. The market's outlook for rate cuts has changed, as the Fed recognizes a robust economy and persistent inflation. FLOT provides a low-risk, high-yield investment choice and has outperformed treasury bonds, achieving a total return of over 7% in the last year.

Traders have dialed back their expectations for immediate Fed rate cuts, now viewing them as less likely in the near term. Investors can navigate this edgy investing backdrop with these ETFs.

FLOT: Long-Term Rate Expectations Up, Short-Term Rates Down

iShares Floating Rate Bond ETF is a fund that provides exposure to U.S. dollar-denominated, investment-grade floating rate bonds. FLOT has performed well with rising interest rates, as floating rate bonds adjust their interest payments accordingly. FLOT offers low interest rate risk, high credit quality, and an attractive yield, making it suitable for conservative income investors.