A growing number of fund companies are looking to tap into the mortgage debt space via ETFs.
has filed for registration the Fidelity Mortgage Securities ETF
, which will normally invest at least 80 percent of its assets in investment-grade mortgage-related securities and also invest in U.S. Government debt. The fund is designed to have similar interest rate risk as the Barclays U.S. MBS Index
. [SEC Filing
According to the SEC filing, the product will also engage "in transactions that have a leveraging effect on the fund, including investments in derivatives - such as swaps (interest rate, total return, and credit default), options, and futures contracts - and forward-settling securities, to adjust the fund's risk exposure."
A number of fund companies have presence in this space, according to the ETF Database
For example, iShares
runs the iShares Barclays MBS Fixed-Rate Bond Fund
, and the iShares GNMA Bond ETF
and Barclays CMBS Bond Fund
. Meanwhile, Vanguard
offers the Vanguard Mortgage-Backed Securities ETF
. State Street
has the SPDR Barclays Capital Mortgage Backed Bond ETF
runs the ProShares USD Covered Bond
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