F/m Investments adds 12-month T-Bill ETF to single-bond suite

Nov 21st, 2022 | By | Category: Fixed Income

Washington-based F/m Investments has expanded its suite of fixed income ETFs comprising just a single underlying US Treasury bond.

Alexander Morris, President and CIO of F/m Investments

Alexander Morris, President and CIO of F/m Investments.

Listed on Nasdaq, the US Treasury 12 Month Bill ETF (OBIL US) holds the most current (on-the-run) issue for the 12-month tenor of the Treasury yield curve.

The fund is the fourth ETF from F/m Investments, following the August 2022 debut of three single-bond ETFs that target the three-month, two-year, and ten-year tenors of the Treasury yield curve.

Those funds are the US Treasury 3 Month Bill ETF (TBIL US), US Treasury 2 Year Note ETF (UTWO US), and US Treasury 10 Year Note ETF (UTEN US). Collectively, the funds have accumulated around $300 million in assets since launch.

Each of the firm’s four ETFs always holds their respective tenor’s latest issue, trading out of the previous issue as soon as a new on-the-run issue is released.

According to F/m Investments, its ETFs are helping to revolutionize how investors access Treasury markets. The firm notes that the funds allow institutional investors to avoid custody issues related to holding actual US Treasuries, while most retail investors are now able to access single-bond trading for the first time.

Each ETF distributes dividends monthly, providing a more frequent and regular interest payment than holding actual US Treasuries, while they also benefit from the liquidity, convenience, and potential tax benefits inherent in the ETF structure.

Each fund comes with an expense ratio of 0.15%.

Alexander Morris, President and CIO of F/m Investments, said: “The application of the existing ETFs has been revolutionary, beyond even our most ambitious expectations. Given the shape of the yield curve today, we are responding to investor demand in launching the highest-yielding tenor, the 12-month, with the intention to prudently launch the other points on the curve.”

Tags: , , , ,

Leave a Comment