The Street's Ron Rowland is with Larry Fink. He is not a fan of target maturity bond ETFs, for sure.

Rowland criticized BlackRock [profile] iShares recently traded term-structured corporate bond ETFs. He said the maturity dates are spaced unevenly at 2016, 2018, 2020 and 2023.

A good ladder has its rungs evenly and predictably spaced. This new iSharesBonds series has three years to the first rung, two-year jumps to the second and third rungs, and then three years to the fourth rung. Furthermore, the fifth rung is undefined.

Rowland says the ETFs series only includes bonds maturing in four of the next ten years, which excludes 60 percent of corporate grade investment grade bonds, a decision he finds arbitrary and nonsensical. He argues that DWS Investments [profile] Guggenheim BulletShares ETF is the better execution of target maturity bond ETFs.

To read more of the WSJ story, click here.  

Edited by: Casey Quinlan


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