U.S. Fixed Income Market

Optimal method of maintaining exposure to fixed income assets while controlling for duration

This Solution Helps

  • ETF Sponsors
  • Institutional Asset Managers
  • Market Data Managers
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With rates poised to increase coupled with the continued need for fixed income exposure, a bond ladder provides the optimal method of maintaining exposure to fixed income assets while controlling for duration. 

To respond to this need in the fixed income market, Nasdaq introduced the Nasdaq LadderRite® USD Corporate Bond Indexes. Each index tracks a diversified basket of bonds using an equally-weighted annual maturity ladder. The proprietary, patent-pending "TOP Rebalancing" methodology is designed to minimize turnover by maximizing the use of the cash flow created by index securities. The TOP Rebalance effectively allocates the cash from maturing securities and coupon payments across added securities, resulting in streamlined portfolio management, fewer transaction costs and less tracking errors. 
 

Eligible bonds include those that pay fixed amounts of taxable interest:

  • Fixed coupon bonds
  • Callable bonds
  • Step-ups, event-driven, rating-driven and registration-driven bonds
  • Amortizing bonds and sinking funds with fixed sinking schedules 
     

The index family currently features the Nasdaq LadderRite 0-5 year USD Corporate Bond Index.

Key Benefits

Exposure

A bond ladder provides the optimal method of maintaining exposure to fixed income assets while controlling for duration.

Minimize Turnover

The proprietary, patent-pending "TOP Rebalancing" methodology is designed to minimize turnover by maximizing the use of the cash flow created by index securities.

Proprietary Rebalancing Methodology

The TOP Rebalance effectively allocates the cash from maturing securities and coupon payments across added securities, resulting in streamlined portfolio management, fewer transaction costs and less tracking errors.

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