TLH - BofA notes that investors continue to inject cash into U.S. Treasuries as yields surge

2023-08-18 13:15:04 ET

U.S. Treasury yields continue their upward march, despite cooling off slightly on Friday and Bank of America’s global research team indicated that market participants continue to pour capital into the bond market. According to BofA, investors have injected another $300M into the bond market on the week, making in 21 straight weeks of positive flows.

In an investor note on Friday, the financial institution highlighted that the bulk of the inflows were pushed into U.S. Treasury bonds as the segment attracted $3.9B on the week and notched yet another positive flow week (27 weeks straight).

Supporting the move has been the jump up in U.S. Treasury yields as the U.S. 2 Year Treasury yield ( US2Y ) sits at 4.91% on Friday after topping 5.00% earlier in the week. At the same time the longer end U.S. 10 Year Treasury yield ( US10Y ) trades at 4.24%.

See further information on U.S. Treasuries here .

Aside from U.S. Treasuries, BofA provided data that showed investment grade bonds pulled in $400M marking the segments fourth consecutive week of net new money and bank loan bonds took in $100M on the week which were the area’s third straight week of positive flows.

On the other end, high yield bonds and emerging market bonds saw net outflows of $1.3B and $2.1B. Moreover, muni bonds handed back $400M and TIPS lost $800M on the week.

For investors closely watching the bond market, see below a breakdown of bond focus areas in the form of exchange traded funds.

U.S. & International Bond ETFs

• Vanguard Total Bond Market ETF ( NASDAQ: BND )
• iShares Core U.S. Aggregate Bond ETF ( NYSEARCA: AGG )
• Vanguard Total International Bond ETF ( BNDX )
• iShares International Treasury Bond ETF ( IGOV )

U.S. Treasury Bond ETFs

• iShares 20+ Year Treasury Bond ETF ( NASDAQ: TLT )
• iShares 10-20 Year Treasury Bond ETF ( TLH )
• iShares 7-10 Year Treasury Bond ETF ( IEF )
• iShares 3-7 Year Treasury Bond ETF ( IEI )
• iShares 1-3 Year Treasury Bond ETF ( SHY )

Corporate Bond ETFs

• iShares iBoxx $ Investment Grade Corporate Bond ETF ( LQD )
• Vanguard Long-Term Corporate Bond ETF ( VCLT )
• Vanguard Intermediate-Term Corporate Bond ETF ( VCIT )
• Vanguard Short-Term Corporate Bond ETF ( VCSH )

For further details see: