A new range of income funds

Generate more income potential across multiple asset classes.

As yields from cash and government bonds remain at near historic lows, the search for income is a top priority for many investors. We believe a multi-asset approach is one of the best ways to generate a good level of income in current market conditions. Enhance your income potential with a comprehensive portfolio including High YieldEmerging Market DebtInvestment Grade and Corporate Bonds.

Investing for Income with iShares ETFs

Liquidity

The growth of the fixed income ETF market has helped create a new source of liquidity for bond investors, above and beyond what you can access in the OTC market. With fixed income ETFs, you effectively get an additional trading venue—the stock exchange—where shares can be transferred among investors without relying on the OTC market.

ETFs can offer an additional source of liquidity for fixed income investors

ETFs can offer an additional source of liquidity for fixed income investors

Cost-Effectiveness

iShares ETFs generally offer price improvement, making the ETF less expensive to trade than a comparable portfolio of bonds. Relative to a basket of bonds, ETFs offer the benefit of on-exchange liquidity, which often results in lower transaction costs.

ETFs may provide bond investors with significant cost savings

ETFs may provide bond investors with significant cost savings

Exploring the New Income Toolkit

You can find more sources of income by taking a multi-asset approach. Use the toolkit below to increase your income potential.

  • High Yield: Strong Fundamentals

    High yield has historically outperformed other fixed income asset classes in recovering markets with rising interest rates1 and continues to be supported by solid fundamentals.2

  • Emerging Market Debt: Surprising quality

    The quality and risk profile of the emerging market debt market has seen considerable improvement in recent years. Low correlation to developed market debt and emerging market equities has made this asset class a popular vehicle for diversification.

  • Investment Grade Corporate Bonds

    For more defensive income seekers, global investment grade corporate bonds offer higher credit quality, while accessing yield from exposure to leading companies across a range of sectors and geographies.

1BlackRock 30/06/15: High yield (as represented by Barclays Capital US High Yield Index) has outperformed Treasuries (as represented by Barclays Capital US Treasury Index) and Bank Loans (as represented by “S&P Leveraged Loan Index).
2BlackRock 30/06/15: Default risk is currently half the long-term average, as measured by the J.P. Morgan Global High Yield Index, 1987- June 2015. 

Why iShares for income?

  • A single iShares trade can provide instant exposure to a diversified portfolio of securities, by asset class, market capitalisation, country or sector. This diversification can help reduce concentration risk and give investors exposure to additional sources of potential return when building income portfolios.

  • Management and transaction costs have the potential to have a meaningful impact on the return of an income portfolio. iShares can be a cost-effective way to gain exposure to a diversified portfolio of securities. iShares are generally less expensive than investing in actively managed funds and even some index funds, and can also be less costly than purchasing a large number of individual shares or bonds.

  • With the minimum investment size for some bonds being up to $500,000, it can be difficult to achieve a diversified exposure to income assets. With iShares you can easily gain access to a diversified portfolio of fixed income securities through a simple trade on the ASX.

  • By trading like shares, iShares provide investors with the flexibility to trade at any time during ASX market hours. This gives investors the flexibility to tailor and adapt their portfolios towards their specific income objectives with ease.

  • The holdings of each iShares are publicly disclosed daily, so that investors always know exactly what they hold in their portfolios and can better understand sources of risk and return.