Bringing Standardization to the Fixed Income ETF Space

BlackRock and several other fixed-income heavyweights are joining forces to provide a new standard to calculate yield, spread and duration for fixed income ETFs.

Stephen Laipply, BlackRock

While still relatively nascent and small, the fixed income exchange-trade fund (ETF) space has been one of the fastest growing markets since the financial crisis, growing from $20 billion in assets in 2006 to over $450 billion globally today.

But the pricing and analysis of these products remains challenging when compared to their equity ETF brethren because a high-yield bond ETF could comprise hundreds of underlying cusips and most of those stocks will not trade on a daily basis.

A group of maj