NEW YORK, June 3, 2015 (GLOBE NEWSWIRE) -- Guggenheim Investments, the global asset management and investment advisory business of Guggenheim Partners, has introduced a unique online resource to help advisors and investors use Guggenheim's popular BulletShares ETFs to build a more efficient laddering strategy consisting of investment-grade and high-yield ETFs with varying terms to maturity.
Advisors and investors can access the BulletShares® ETF Bond Laddering Tool by visiting guggenheiminvestments.com/bondladder. The Laddering Tool can be used to customize a hypothetical ladder by factoring such criteria as maturity range, portfolio weighting, duration, yield distribution, yield-to-maturity, yield-to-worst, and number of holdings.
"Bond laddering offers a number of potential benefits, but creating bond ladders with individual bonds can be time consuming and cost prohibitive," said William Belden, Managing Director, Product Development at Guggenheim Investments. "In contrast, Guggenheim BulletShares® ETFs offer investors a cost effective and convenient approach to portfolio laddering."
Launched in 2010 as the first defined maturity corporate bond ETFs available in the market, the Guggenheim BulletShares lineup now consists of 18 unique defined-maturity investment grade and high yield corporate bond ETFs with more than $6 billion in assets under management.
Unlike other fixed-income ETFs, BulletShares are designed to mature in their target year, providing investors with specific maturities to ladder portfolios or to manage their fixed-income exposure within specific investment time frames. With maturity dates spanning from 2015 to 2024*, BulletShares ETFs track indices of approximately 30 to 300 corporate bonds with effective maturities in the same calendar year as each fund's maturity.
As bonds in a laddered portfolio mature, the cash distribution is generally utilized to cover lifestyle needs or reinvested in new bonds at the longest maturity of the ladder at the then current interest rate. Prior to maturity, this approach offers potential advantages in both rising and falling interest rate environments.
"If interest rates increase, an investor can reinvest the proceeds, if any, from maturing bonds at higher interest rates," Belden said. "If interest rates decrease, the investor potentially benefits from price appreciation as the portfolio's higher-yielding bonds increase in value."
In addition to the new BulletShares ETF Bond Laddering Tool, advisors and investors can access three short three-minute videos designed to educate advisors and investors on the valuable features and potential benefits found in its innovative and increasingly popular BulletShares ETF lineup. The videos can be accessed on the ETF Education home page in the Exchange Traded Funds section of the Guggenheim Investments site or at guggenheiminvestments.com/products/etf/etf-education .
About Guggenheim Investments
Guggenheim Investments is the global asset management and investment advisory division of Guggenheim Partners with $204 billion1 in total assets across fixed income, equity, and alternative strategies. We focus on the return and risk needs of insurance companies, corporate and public pension funds, sovereign wealth funds, endowments and foundations, consultants, wealth managers, and high-net-worth investors. Our 275+ investment professionals perform rigorous research to understand market trends and identify undervalued opportunities in areas that are often complex and underfollowed. This approach to investment management has enabled us to deliver innovative strategies providing diversification opportunities and attractive long-term results.
Guggenheim Investments offers investors a broad range of ETPs—domestic and international equity, fixed-income and currency—to provide the core building blocks for portfolios, access to hard-to-reach market segments, as well as targeted investment choices.
About Guggenheim BulletShares® ETFs
Combining the benefits of bonds—control of portfolio maturity, yield and credit quality—with the broad diversification, liquidity and convenience of ETFs, Guggenheim BulletShares® ETFs offer investors the best of both worlds. To view the entire BulletShares offering, please visit guggenheiminvestments.com/products/etf/bulletshares.
With maturity dates spanning from 2015 to 2024, there are 18 corporate bond and high-yield corporate bond BulletShares ETFs to choose from. These defined-maturity ETFs enable investors to implement date-sensitive investment strategies such as building a laddered bond portfolio, filling gaps in existing portfolios, obtaining year-specific yield-curve exposure and managing future cash flow needs.
* The funds do not seek to return any predetermined amount at maturity, and the amount an investor receives may be worth more or less than their original investment
The funds have designated years of maturity ranging from 2015 to 2024 and will terminate on or about December 31st of their respective maturity year. In connection with such termination, each fund will make a cash distribution to then-current shareholders of its net assets after making appropriate provisions for any liabilities of the fund. The funds do not seek to return any predetermined amount at maturity. In the final six months of operation, as the bonds held by the fund mature, the fund's portfolio will transition to cash and cash equivalents, including without limitation U.S. Treasury Bills and investment-grade commercial paper, which may result in a lower yield than the yields of the bonds previously held by the fund and/or prevailing yields for bonds in the market. The funds will terminate on or about the date above without requiring additional approval by the Trust's Board of Trustees (the "Board") or fund shareholders. The Board may change the termination date to an earlier or later date if a majority of the Board determines the change to be in the best interest of the funds.
Past performance is no guarantee of future results
Investors should consider the following risk factors and special considerations associated with investing in the fund, which may cause you to lose money, including the entire principal amount that you invest. Interest Rate Risk: As interest rates rise, the value of fixed-income securities held by the fund are likely to decrease. Securities with longer durations tend to be more sensitive to interest rate changes, making them more volatile than securities with shorter durations. Credit/Default Risk: Issuers or guarantors of debt instruments or the counterparty to a repurchase agreement or loan of portfolio securities may be unable or unwilling to make timely interest and/or principal payments or otherwise honor its obligations. Debt instruments are subject to varying degrees of credit risk, which may be reflected in credit ratings. Securities issued by the U.S. government generally have less credit risk than debt securities of nongovernment issuers. High-Yield Securities Risk: High yield securities generally offer a higher current yield than that available from higher-grade issues, but typically involve greater risk. Securities rated below investment grade are commonly referred to as "junk bonds." The ability of issuers of high-yield securities to make timely payments of interest and principal may be adversely impacted by adverse changes in general economic conditions, changes in the financial condition of the issuers and price fluctuations in response to changes in interest rates. Asset Class Risk: The bonds in the fund's portfolio may underperform the returns of other bonds or indexes that track other industries, markets, asset classes or sectors. Call Risk/Prepayment Risk: During periods of falling interest rates, an issuer of a callable bond may exercise its right to pay principal on an obligation earlier than expected. This may result in the fund's having to reinvest proceeds at lower interest rates, resulting in a decline in the fund's income. Extension Risk: An issuer may exercise its right to pay principal on an obligation later than expected. This may happen when there is a rise in interest rates. Under these circumstances, the value of the obligation will decrease and the fund's performance may suffer from its inability to invest in higher-yielding securities. Income Risk: Falling interest rates may cause the fund's income to decline. Liquidity Risk: If the fund invests in illiquid securities or securities that become illiquid, fund returns may be reduced because the fund may be unable to sell the illiquid securities at an advantageous time or price. Declining Yield Risk: During the final year of the fund's operations, as the bonds held by the fund mature and the fund's portfolio transitions to cash and cash equivalents, the fund's yield will generally tend to move toward the yield of cash and cash equivalents and thus may be lower than the yields of the bonds previously held by the fund and/or prevailing yields for bonds in the market. Fluctuation of Yield and Liquidation Amount Risk: The fund, unlike a direct investment in a bond that has a level coupon payment and a fixed payment at maturity, will make distributions of income that vary over time. Unlike a direct investment in bonds, the breakdown of returns between fund distributions and liquidation proceeds are not predictable at the time of your investment. For example, at times during the fund's existence, it may make distributions at a greater (or lesser) rate than the coupon payments received on the fund's portfolio, which will result in the fund returning a lesser (or greater) amount on liquidation than would otherwise be the case. The rate of fund distribution payments may adversely affect the tax characterization of your returns from an investment in the fund relative to a direct investment in corporate bonds. If the amount you receive as liquidation proceeds upon the fund's termination is higher or lower than your cost basis, you may experience a gain or loss for tax purposes. Financial Services Sector Risk: The financial services industries are subject to extensive government regulation, can be subject to relatively rapid change due to increasingly blurred distinctions between service segments, and can be significantly affected by availability and cost of capital funds, changes in interest rates, the rate of corporate and consumer debt defaults, and price competition. Consumer Discretionary Sector Risk: The success of consumer product manufacturers and retailers is tied closely to the performance of the overall domestic and international economy, interest rates, competitive and consumer confidence. Success depends heavily on disposable household income and consumer spending. Concentration Risk: If the index concentrates in an industry or group of industries, the fund's investments will be concentrated accordingly. In such event, the value of the fund's shares may rise and fall more than the value of shares of a fund that invests in securities of companies in a broader range of industries. In addition the funds are subject to: Non-Correlation Risk, Replication Management Risk, Issuer- Specific Changes and Non-Diversified fund Risk. Please read the fund's prospectus for more detailed information on these risks and considerations.
BulletShares®, BulletShares® USD Corporate Bond Index, and BulletShares® USD High Yield Corporate Bond Index are trademarks of Accretive Asset Management LLC and have been licensed for use by Guggenheim Investments. Accretive Asset Management, LLC is an affiliate of Guggenheim Investments.
Read a fund's prospectus and summary prospectus (if available) carefully before investing. It contains the fund's investment objectives, risks, charges, expenses and other information, which should be considered carefully before investing. Obtain a prospectus and summary prospectus (if available) at www.guggenheiminvestments.com or call 800.820.0888.
1 Guggenheim Investments total asset figure is as of 3.31.2015. The assets include leverage of $12.6bn for assets under management and $0.5bn for assets for which we provide administrative services. Guggenheim Investments represents the following affiliated investment management businesses: Guggenheim Partners Investment Management, LLC, Security Investors, LLC, Guggenheim Funds Investment Advisors, LLC, Guggenheim Funds Distributors, LLC, Guggenheim Real Estate, LLC, Transparent Value Advisors, LLC, GS GAMMA Advisors, LLC, Guggenheim Partners Europe Limited and Guggenheim Partners India Management.