Invesco International Corporate Bond ETF (ARCA: PICB)

Latest news for Invesco International Corporate Bond ETF (ARCA:PICB)

Invesco International Corporate Bond ETF

PowerShares International Corporate Bond Portfolio

The fund generally will invest at least 80% of its total assets in investment grade corporate bonds that comprise the underlying index. The underlying index measures the performance of investment grade corporate bonds issued in the following currencies of Group of Ten countries, excluding the U.S. Dollar (USD): Australian Dollar (AUD), British Pound (GBP), Canadian Dollar (CAD), Euro (EUR), Japanese Yen (JPY), New Zealand Dollar (NZD), Norwegian Krone (NOK), Swedish Krona (SEK) and Swiss Franc (SFR).

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PIMCO CIO Daniel Ivascyn warns of a potential economic downturn in the UK next year. Bond yields have already dropped significantly, and investors in the iShares MSCI United Kingdom ETF should monitor developments.

PIMCO CIO Warns Of &#39;Hard Landing&#39; For UK Economy

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PIMCO CIO Daniel Ivascyn warned there is a strong chance of a significant economic downturn in the U.K. next year. 
"We do think there's potentially more hard landing risks,&#8221; said Ivascyn. &#8220;The U.S. economy has proven to be surprisingly resilient in 2023, but the U.K. and Europe risk a <a href="https://www.benzinga.com/news/global">more significant deterioration</a>.&#8221;
Ivascyn was betting more on U.K. government bonds than U.S. ones because he believed the U.K. would experience more economic hardship, as <a href="https://www.ft.com/content/a2e7787a-d64c-46ab-9b6f-62897a547616">reported</a> by the Financial Times.
The U.K. economy unexpectedly contracted in October, falling by 0.3% following a 0.2% growth in September. The Bank of England revised its prediction for economic growth in the fourth quarter to flat from 0.1 earlier, citing lower household spending as one of the reasons.
A weaker economic outlook typically pulls bond yields down, thereby generating strong returns for bondholders. Since late October, U.K. government bond yields — which move inversely to prices — have already dropped significantly, with benchmark 10-year yields falling by a full percentage point to roughly 3.7%.
A weakening economy also impacts equity negatively. Investors in the iShares MSCI United Kingdom ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/EWU#NYSE">EWU</a>) should keep track of economic developments coming from the UK area.
Also Read: <a href="https://www.benzinga.com/news/23/12/36046619/can-robinhood-shake-up-the-uk-trading-scene-with-its-commission-free-model">Can Robinhood Shake Up the UK Trading Scene with Its Commission-Free Model?</a>
&#8220;Global bond investing is back. It's the first time in a long time we've been excited about value and relative value in the U.K., Europe and Japan,&#8221; exclaimed Ivascyn. The Invesco International Corporate Bond ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/PICB#NYSE">PICB</a>) tracks European bonds. The Invesco Global ex-US High Yield Corporate Bond ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/PGHY#NYSE">PGHY</a>), the Simplify Opportunistic Income ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/CRDT#NYSE">CRDT</a>) and the VanEck International High Yield Bond ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IHY#NYSE">IHY</a>) help investors get exposure to international bonds.
The U.S. economy has continued to develop, in sharp contrast to the pessimistic forecasts for the U.K. and the eurozone. The U.S. equity-tracking SPDR S&amp;P 500 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SPY#NYSE">SPY</a>) has returned 24.35% to investors over the past year, compared to iShares MSCI United Kingdom ETF, which has returned 8.85%.
Check Out: <a href="https://www.benzinga.com/money/best-online-brokers-for-bonds">Best Online Brokers for Bonds</a>

PIMCO CIO Warns Of 'Hard Landing' For UK Economy

The Fed may have enacted three rate hikes this year but geopolitics and mixed U.S. economic readings have kept U.S. Treasury yields at check.&nbsp;U.S. benchmark Treasury bond yields have hovered in the range of 2.05% to 2.62% this year (as of Dec 27, 2017), with an average of 2.33%.
Trump&#39;s policy uncertainty in the middle of the year and Fed minutes, which showed policymakers&#39; suspicion about subdued inflation, probably led to this move in the fixed income market. Though the economy picked up pace in the fourth quarter, President Trump passed the tax reform agenda and the Fed enacted its final hike, average bond yields (2.37%) did not shoot up materially.&nbsp;
This was because, with Fed officials sticking to their outlook for three more rate hikes in 2018 despite speeding economic growth, there is no spark in the guidance either. In fact, an air of dovishness was prevalent. The median Fed funds rate for this year and the next were unchanged (read: <a href="https://www.zacks.com/stock/news/286001/etf-winners-amp-losers-post-partly-dovish-fed-meet">ETF Winners &amp; Losers Post Partly Dovish Fed Meet</a>).
As a result, bond funds returned decently in 2017. PIMCO 25+ Year Zero Coupon US Treasury ETF ZROZ returned about 12% this year against 19.6% returns in SPDR S&amp;P 500 ETF SPY.
However, there are several international bond ETFs that offered great returns during this time frame. Since most of the developed economies are still practicing a low interest rate policy, international bonds got a chance to roar even higher. Against this backdrop, below we highlight a few top-performing bond ETFs.
iShares International High Yield Bond ETF HYXU &ndash; Up 17.8%
The underlying Markit iBoxx Global Developed Markets ex-US High Yield Index is a rules-based one, consisting of high yield corporate bonds denominated in Euros, British pounds sterling and Canadian dollars. The index is designed to provide a broad representation of the global ex-U.S. dollar high yield corporate bond market. The fund charges 40 bps in fees.
SPDR Bloomberg Barclays International Corp Bond ETF IBND &ndash; Up 13.5%
The 618-security fund looks to provide broad exposure to the global investment grade, fixed rate, fixed income corporate markets outside the United States. The fund charges 50 bps in fees. Average maturity in years is 6.61, while adjusted duration is 5.82 years.&nbsp;
PowerShares International Corp Bond ETF PICB &ndash; Up 11.3%
The underlying index measures the performance of investment grade corporate bonds issued by non-U.S. issuers. The 411-stock fund charges 50 bps in fees. Years to Maturity of the fund is 9.32 and effective duration is 7.31 years.
SPDR Bloomberg Barclays Emerging Markets Local Bond ETF EBND &ndash; Up 11.1%
The underlying index &ndash; the Bloomberg Barclays EM Local Currency Government Diversified Index &ndash; is designed to measure the performance of the fixed-rate local currency sovereign debt of emerging market countries. The fund looks to offer exposure to fixed-rate local currency sovereign debt of emerging market countries. It charges 40 bps in fees. Average maturity of the fund is 7.36 years and adjusted duration is 5.29 years.
VanEck Vectors JP Morgan EM Local Bond ETF EMLC &ndash; Up 7.5% 
The fund comprises 266 bonds issued by emerging market governments and denominated in the local currency of the issuer. The fund charges 44 bps in fees. Years to Maturity of the fund is 7.65 and effective duration is 5.10 years. The fund yields about 5.34% annually (as of Dec 27, 2017) (read: <a href="https://www.zacks.com/stock/news/271415/em-etfs-what-you-need-to-know-before-investing">EM ETFs: What You Need to Know Before Investing</a>).
<img alt="" src="https://staticx-tuner.zacks.com/images/zadmin_tuner_image/bond etfs chart.jpg" style="width: 620px; height: 166px;" />

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HYXU

The first-to-market advantage is not one that should be understated or underestimated when it comes to ETFs. Countless ETFs <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/02/2310295/more-me-too-etfs-from-ishares-debut-today">have thrived</a> not because they are the best funds in their particular niche, but simply because they were the first funds to offer investors exposure to a certain concept.

Time will tell just how good the newly minted WisdomTree Emerging Markets Corporate Bond Fund (Nasdaq: <a class="ticker" href="/stock/emcb#Nasdaq">EMCB</a>) really is, but one thing is undeniable: It is the first ETF exclusively devoted to emerging markets corporate bonds. 

There are other certainties regarding the WisdomTree Emerging Markets Corporate Bond Fund. One is the ETF is VERY new. New as in it has as an inception date of March 8, 2012. Another is that EMCB has been met with open arms by investors. The ETF had over $60 million in assets under management as of March 19, according to the WisdomTree Web site. 

Success with <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/02/2356406/five-thinly-traded-etfs-to-consider-ald-scin-bno">emerging markets bond funds</a> is nothing new to WisdomTree (Nasdaq: <a class="ticker" href="/stock/wetf#Nasdaq">WETF</a>). The WisdomTree Asia Local Debt ETF (NYSE: <a class="ticker" href="/stock/ald#NYSE">ALD</a>) and the WisdomTree Emerging Markets Local Debt ETF (NYSE: <a class="ticker" href="/stock/eld#NYSE">ELD</a>) have proven to be two of the most popular non-dollar bond funds on the market and have over $1.6 billion in AUM combined.

For its part, EMCB's holdings are dollar-denominated and nearly half of them are rated investment grade. EMCB, which has an expense ratio of 0.6%, offers exposure to corporate issues from seven sectors, though oil, industrials, metals and telecom names represent over 86% of the fund's weight. Utilities, banks and consumer stocks fight for the remaining scraps.

At the country level, EMCB stamps investors' passports to 14 destinations, but Brazil, Russia and Mexico combine for about 55% of the fund's country weight. Hong Kong, South Korea and Colombia combine for another 19%.

Speaking of EMCB's country weights, investors should note that the fund is not a pure emerging markets play and that does not mean some developed markets sneak into the ETF's lineup. Rather, EMCB features smaller weights to Kazakhstan, Qatar and Jamaica, all of which are frontier markets. Overall, Latin American issues account for just over half of EMCB's weight while Asia checks in at 23.6%. Eurpoe, Africa and the Middle East share the remainder.

In a yield-starved environment, EMCB might prove to be a fine alternative for adventurous investors looking for a spicier alternative to the iShares iBoxx $ Investment Grade Corporate Bond ETF (NYSE: <a class="ticker" href="/stock/lqd#NYSE">LQD</a>) and the PowerShares International Corporate Bond ETF (NYSE: <a class="ticker" href="/stock/picb#NYSE">PICB</a>), which focuses more on developed market issues.

 As WisdomTree noted: "Investment-grade, emerging-market corporate bonds have historically offered a significant yield premium compared to similarly rated U.S. corporate securities."

Bottom line: It's still early in EMCB's lifespan to be passing judgment on it, but the fund serves a previously unserved niche and an interesting one at that. Expect rivals to sprout up to challenge EMCB and expect to maintain its dominant AUM position, at least for a while.

Last week AdvisorShares introduced four new actively managed ETFs from two different managers.  Madrona Funds, LLC is the sub-advisor and portfolio manager of three new “Madrona Forward” ETFs while American Wealth Management is the sub-advisor and portfolio manager for the “Meidell Tactical” ETF.  These additions bring the number of actively managed ETF listings to 40.  Despite the high level of interest, <a href="http://investwithanedge.com/5-obstacles-facing-active-etfs" target="_blank">actively managed ETFs still face numerous obstacles</a>.
The three Madrona Forward ETFs were launched 6/21/11 (<a href="http://www.marketwire.com/press-release/AdvisorShares-Set-to-Launch-3-Madrona-Funds-ETFs-1529025.htm" target="_blank">press release</a>) and are managed by Brian Evans, Robert Bauer, and Kristi Henderson.  All three members of the portfolio management team are CPAs whose investment approach is more fully described in the <a href="http://advisorshares.com/system/files/funds/public_docs/Whitepaper_Madrona_052011_0.pdf" target="_blank">Forward-Looking Broad-Market Investing White Paper</a> (pdf).  Further information is below and in the <a href="http://advisorshares.com/system/files/funds/public_docs/AdvisorShares%20Trust%20-%20Madrona%20Prospectus%20_FINAL%20as%20Filed%202_14_11__0.pdf" target="_blank">Madrona Prospectus</a> (pdf).
The AdvisorShares Meidell Tactical Advantage ETF (MATH), launched 6/23/11 (<a href="http://www.marketwire.com/press-release/AdvisorShares-Launches-the-Meidell-Tactical-Advantage-ETF-MATH-1530623.htm" target="_blank">press release</a>), will be managed by Laif Meidell of American Wealth Management.  The MATH strategy, based on a combination of relative strength and moving averages, tries to increase exposure to stronger areas of the market and shift to defensive positions when markets decline.  The new ETF is described below (following the three Madrona Forward ETFs).
AdvisorShares Madrona Forward Domestic ETF (FWDD) seeks to provide long-term capital appreciation above the S&amp;P 500 Index by selecting a portfolio of up to 500 of the largest U.S. traded equity securities.  It uses a weighted allocation system based on consensus analyst estimates of the present value of future expected earnings relative to the share price of each security.
The largest sector allocations are Consumer Discretionary 19%, Technology 17%, and Financials 15%.  FWDD currently holds about 480 stocks, all with allocations of less than 0.5% each.  The expense ratio estimate is 1.12% with a 1.25% cap.  Additional data is located in <a href="http://advisorshares.com/fund/fwdd" target="_blank">FWDD overview</a> and <a href="http://advisorshares.com/system/files/funds/public_docs/FWDD_FS_06202011.pdf" target="_blank">FWDD fact sheet</a> (pdf).
AdvisorShares Madrona Forward International ETF (FWDI) seeks to provide long-term capital appreciation above the MSCI EAFE Index and the BNY Mellon Classic ADR Index by selecting a portfolio primarily composed of at least 250 of the largest American Depositary Receipts (ADRs) from EAFE countries, Canada, and emerging markets.
FWDI currently has about 76% exposure to developed markets and 24% to emerging markets.  Regional allocations include Europe 50%, Pacific/Asia 40%, Americas 6%, and Africa/Middle East 4%.  FWDI presently holds about 260 stocks and ADRs, all with allocations of less than 0.8%.  The expense ratio estimate is 1.12% with a 1.25% cap.  Additional data is located in the <a href="http://advisorshares.com/fund/fwdi" target="_blank">FWDI overview</a> and <a href="http://advisorshares.com/system/files/funds/public_docs/FWDI_FS_06202011.pdf" target="_blank">FWDI fact sheet</a> (pdf).
AdvisorShares Madrona Forward Global Bond (FWDB) seeks investment results that exceed the price and yield performance of the Barclays Capital Aggregate Bond Index by selecting a diversified portfolio of fixed income, currency, and commodity pool exchange-traded products (ETPs).  FWDB uses a “fund of funds” approach and invests in at least 12 distinct global bond classes.  The manager uses a weighted allocation system based on historic yield curve analysis and a mean reversion strategy.
FWDB currently holds 16 ETFs with the largest allocations going to iShares iBoxx $ Investment Grade Corporate Bond (<a class="ticker" href="/stock/lqd#">LQD</a>) 18.1%, Vanguard Mortgage Backed Securities ETF (<a class="ticker" href="/stock/vmbs#">VMBS</a>) 14.1%, iShares iBoxx $ High Yield Corporate Bond (<a class="ticker" href="/stock/hyg#">HYG</a>) 13.2%, PowerShares International Corporate Bond (<a class="ticker" href="/stock/picb#">PICB</a>) 8.0%, and Vanguard Intermediate-Term Government Bond ETF (VGIT) 5.0%.  The expense ratio is capped at 1.15% assuming the acquired fund fees do not exceed 0.20%.  Additional data is located in the <a href="http://advisorshares.com/fund/fwdb" target="_blank">FWDB overview</a> and <a href="http://advisorshares.com/system/files/funds/public_docs/FWDB_FS_06202011.pdf" target="_blank">FWDB fact sheet</a> (pdf).
AdvisorShares Meidell Tactical Advantage ETF (MATH) seeks to provide long-term capital appreciation and capital preservation with a  strategy that can dynamically rebalance the portfolio from as much as 100% equity assets to 100% fixed income assets or cash, depending on market trends.  MATH is a “fund-of-funds” that seeks to minimize portfolio losses by rotating out of higher volatility assets and into lower volatility asset classes.
MATH is currently in a defensive posture with a Fixed Income allocation of 57%, Cash 14%, US Equities 24%, and Commodities 4%.  The fund has 17 holdings with the largest being Cash 14.1%, SPDR Barclays TIPS ETF (<a class="ticker" href="/stock/ipe#">IPE</a>) 9.6%, iShares Barclays TIPS Fund (<a class="ticker" href="/stock/tip#">TIP</a>) 9.6%, Vanguard Intermediate-Term Bond ETF (<a class="ticker" href="/stock/biv#">BIV</a>) 4.8%, and iShares S&amp;P Small Cap 600 Index Fund (<a class="ticker" href="/stock/ijr#">IJR</a>) 4.8%.  The gross expense ratio is 2.20% but will be capped at 1.60%.  Additional data is located in the <a href="http://advisorshares.com/fund/math" target="_blank">MATH overview</a>, <a href="http://advisorshares.com/system/files/funds/public_docs/MATH_FS_06222011.pdf" target="_blank">MATH fact sheet</a> (pdf), and the <a href="http://advisorshares.com/system/files/funds/public_docs/AdvisorShares%20-%20Meidell%20Tactical%20ETF%20Prospectus%20dated%20June%206%2C%202011%20-%20FINAL.pdf" target="_blank">MATH Prospectus</a> (pdf).
Disclosure covering writer, editor, and publisher:  No positions in any of the securities mentioned.  No positions in any of the companies or ETF sponsors mentioned.  No income, revenue, or other compensation (either directly or indirectly) received from, or on behalf of, any of the companies or ETF sponsors mentioned.
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VMBS

AdvisorShares Launches Four New Actively Managed ETFs

When it comes to corporate bond ETFs, for better or worse, the discussion seems to begin and end with the iShares iBoxx $ Investment Grade Corporate Bond Fund (NYSE: <a class="ticker" href="/stock/lqd#NYSE">LQD</a>). That's not surprising as LDQ is simply the juggernaut of this ETF genre. Almost nine years old, LQD has amassed nearly $14 billion in assets under management.

That's quite studly, but there are other options in the corporate bond arena to consider, particularly for the investor looking for some international exposure. For those craving some global, high-grade corporate bond fare today's “Under the Hood” candidate, the PowerShares International Corporate Bond Portfolio (NYSE: <a class="ticker" href="/stock/picb#NYSE">PICB</a>) is worth a look.

As it turns out, PICB celebrated its first birthday last week and in its 53 weeks of trading, the ETF has done pretty well for itself, hauling in nearly $55 million in AUM. With an expense ratio of 0.5% and 168 holdings, PICB focuses on high-grade corporate debt issues denominated in Australian dollars, British pounds, euros, Canadian dollars, Japanese yen and Swedish krona, among other non-dollar currencies.

Along those lines, it should come as no surprise that PICB focuses almost exclusively on developed markets. British corporate bonds account for over 17% of the ETF's weight while France chimes in at over 8%. Italy and Germany both get weights above 7%.

Despite the international bias, PICB is home to bonds from issuers most American investors have at least heard of such as Barclays (NYSE: <a class="ticker" href="/stock/bcs#NYSE">BCS</a>), Bank of Nova Scotia (NYSE: <a class="ticker" href="/stock/bns#NYSE">BNS</a>), France Telecom (NYSE: <a class="ticker" href="/stock/fte#NYSE">FTE</a>) and Telefonica (NYSE: <a class="ticker" href="/stock/tef#NYSE">TEF</a>).

With a distribution yield of 3.66%, PICB certainly represents a better option than a money market or a CD, not to mention the ETF is optionable, presenting investors with another avenue for generating income. PICB's yield to maturity and yield to worst are both 4.28%.

Alright, so we've packed a lot of statistics into this edition of “Under the Hood,” but the most important statistic of all highlights why investors may want to consider PICB before LQD. The PowerShares offering is up 6.4% year-to-date, nearly triple the returns offered by the bigger, more popular LQD.

Forex

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WINC

PIMCO CIO Daniel Ivascyn warned there is a strong chance of a significant economic downturn in the U.K. next year. 



"We do think there's potentially more hard landing risks,&#8221; said Ivascyn. &#8220;The U.S. economy has proven to be surprisingly resilient in 2023, but the U.K. and Europe risk a <a href="https://www.benzinga.com/news/global">more significant deterioration</a>.&#8221;



Ivascyn was betting more on U.K. government bonds than U.S. ones because he believed the U.K. would experience more economic hardship, as <a href="https://www.ft.com/content/a2e7787a-d64c-46ab-9b6f-62897a547616">reported</a> by the Financial Times.



The U.K. economy unexpectedly contracted in October, falling by 0.3% following a 0.2% growth in September. The Bank of England revised its prediction for economic growth in the fourth quarter to flat from 0.1 earlier, citing lower household spending as one of the reasons.



A weaker economic outlook typically pulls bond yields down, thereby generating strong returns for bondholders. Since late October, U.K. government bond yields — which move inversely to prices — have already dropped significantly, with benchmark 10-year yields falling by a full percentage point to roughly 3.7%.



A weakening economy also impacts equity negatively. Investors in the iShares MSCI United Kingdom ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/EWU#NYSE">EWU</a>) should keep track of economic developments coming from the UK area.



Also Read: <a href="https://www.benzinga.com/news/23/12/36046619/can-robinhood-shake-up-the-uk-trading-scene-with-its-commission-free-model">Can Robinhood Shake Up the UK Trading Scene with Its Commission-Free Model?</a>



&#8220;Global bond investing is back. It's the first time in a long time we've been excited about value and relative value in the U.K., Europe and Japan,&#8221; exclaimed Ivascyn. The Invesco International Corporate Bond ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/PICB#NYSE">PICB</a>) tracks European bonds. The Invesco Global ex-US High Yield Corporate Bond ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/PGHY#NYSE">PGHY</a>), the Simplify Opportunistic Income ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/CRDT#NYSE">CRDT</a>) and the VanEck International High Yield Bond ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IHY#NYSE">IHY</a>) help investors get exposure to international bonds.



The U.S. economy has continued to develop, in sharp contrast to the pessimistic forecasts for the U.K. and the eurozone. The U.S. equity-tracking SPDR S&amp;P 500 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SPY#NYSE">SPY</a>) has returned 24.35% to investors over the past year, compared to iShares MSCI United Kingdom ETF, which has returned 8.85%.



Check Out: <a href="https://www.benzinga.com/money/best-online-brokers-for-bonds">Best Online Brokers for Bonds</a>

The Fed may have enacted three rate hikes this year but geopolitics and mixed U.S. economic readings have kept U.S. Treasury yields at check.&nbsp;U.S. benchmark Treasury bond yields have hovered in the range of 2.05% to 2.62% this year (as of Dec 27, 2017), with an average of 2.33%.
Trump&#39;s policy uncertainty in the middle of the year and Fed minutes, which showed policymakers&#39; suspicion about subdued inflation, probably led to this move in the fixed income market. Though the economy picked up pace in the fourth quarter, President Trump passed the tax reform agenda and the Fed enacted its final hike, average bond yields (2.37%) did not shoot up materially.&nbsp;
This was because, with Fed officials sticking to their outlook for three more rate hikes in 2018 despite speeding economic growth, there is no spark in the guidance either. In fact, an air of dovishness was prevalent. The median Fed funds rate for this year and the next were unchanged (read: <a href="https://www.zacks.com/stock/news/286001/etf-winners-amp-losers-post-partly-dovish-fed-meet">ETF Winners &amp; Losers Post Partly Dovish Fed Meet</a>).
As a result, bond funds returned decently in 2017. PIMCO 25+ Year Zero Coupon US Treasury ETF ZROZ returned about 12% this year against 19.6% returns in SPDR S&amp;P 500 ETF SPY.
However, there are several international bond ETFs that offered great returns during this time frame. Since most of the developed economies are still practicing a low interest rate policy, international bonds got a chance to roar even higher. Against this backdrop, below we highlight a few top-performing bond ETFs.
iShares International High Yield Bond ETF HYXU &ndash; Up 17.8%
The underlying Markit iBoxx Global Developed Markets ex-US High Yield Index is a rules-based one, consisting of high yield corporate bonds denominated in Euros, British pounds sterling and Canadian dollars. The index is designed to provide a broad representation of the global ex-U.S. dollar high yield corporate bond market. The fund charges 40 bps in fees.
SPDR Bloomberg Barclays International Corp Bond ETF IBND &ndash; Up 13.5%
The 618-security fund looks to provide broad exposure to the global investment grade, fixed rate, fixed income corporate markets outside the United States. The fund charges 50 bps in fees. Average maturity in years is 6.61, while adjusted duration is 5.82 years.&nbsp;
PowerShares International Corp Bond ETF PICB &ndash; Up 11.3%
The underlying index measures the performance of investment grade corporate bonds issued by non-U.S. issuers. The 411-stock fund charges 50 bps in fees. Years to Maturity of the fund is 9.32 and effective duration is 7.31 years.
SPDR Bloomberg Barclays Emerging Markets Local Bond ETF EBND &ndash; Up 11.1%
The underlying index &ndash; the Bloomberg Barclays EM Local Currency Government Diversified Index &ndash; is designed to measure the performance of the fixed-rate local currency sovereign debt of emerging market countries. The fund looks to offer exposure to fixed-rate local currency sovereign debt of emerging market countries. It charges 40 bps in fees. Average maturity of the fund is 7.36 years and adjusted duration is 5.29 years.
VanEck Vectors JP Morgan EM Local Bond ETF EMLC &ndash; Up 7.5% 
The fund comprises 266 bonds issued by emerging market governments and denominated in the local currency of the issuer. The fund charges 44 bps in fees. Years to Maturity of the fund is 7.65 and effective duration is 5.10 years. The fund yields about 5.34% annually (as of Dec 27, 2017) (read: <a href="https://www.zacks.com/stock/news/271415/em-etfs-what-you-need-to-know-before-investing">EM ETFs: What You Need to Know Before Investing</a>).
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The first-to-market advantage is not one that should be understated or underestimated when it comes to ETFs. Countless ETFs <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/02/2310295/more-me-too-etfs-from-ishares-debut-today">have thrived</a> not because they are the best funds in their particular niche, but simply because they were the first funds to offer investors exposure to a certain concept.

Time will tell just how good the newly minted WisdomTree Emerging Markets Corporate Bond Fund (Nasdaq: <a class="ticker" href="/stock/emcb#Nasdaq">EMCB</a>) really is, but one thing is undeniable: It is the first ETF exclusively devoted to emerging markets corporate bonds. 

There are other certainties regarding the WisdomTree Emerging Markets Corporate Bond Fund. One is the ETF is VERY new. New as in it has as an inception date of March 8, 2012. Another is that EMCB has been met with open arms by investors. The ETF had over $60 million in assets under management as of March 19, according to the WisdomTree Web site. 

Success with <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/02/2356406/five-thinly-traded-etfs-to-consider-ald-scin-bno">emerging markets bond funds</a> is nothing new to WisdomTree (Nasdaq: <a class="ticker" href="/stock/wetf#Nasdaq">WETF</a>). The WisdomTree Asia Local Debt ETF (NYSE: <a class="ticker" href="/stock/ald#NYSE">ALD</a>) and the WisdomTree Emerging Markets Local Debt ETF (NYSE: <a class="ticker" href="/stock/eld#NYSE">ELD</a>) have proven to be two of the most popular non-dollar bond funds on the market and have over $1.6 billion in AUM combined.

For its part, EMCB's holdings are dollar-denominated and nearly half of them are rated investment grade. EMCB, which has an expense ratio of 0.6%, offers exposure to corporate issues from seven sectors, though oil, industrials, metals and telecom names represent over 86% of the fund's weight. Utilities, banks and consumer stocks fight for the remaining scraps.

At the country level, EMCB stamps investors' passports to 14 destinations, but Brazil, Russia and Mexico combine for about 55% of the fund's country weight. Hong Kong, South Korea and Colombia combine for another 19%.

Speaking of EMCB's country weights, investors should note that the fund is not a pure emerging markets play and that does not mean some developed markets sneak into the ETF's lineup. Rather, EMCB features smaller weights to Kazakhstan, Qatar and Jamaica, all of which are frontier markets. Overall, Latin American issues account for just over half of EMCB's weight while Asia checks in at 23.6%. Eurpoe, Africa and the Middle East share the remainder.

In a yield-starved environment, EMCB might prove to be a fine alternative for adventurous investors looking for a spicier alternative to the iShares iBoxx $ Investment Grade Corporate Bond ETF (NYSE: <a class="ticker" href="/stock/lqd#NYSE">LQD</a>) and the PowerShares International Corporate Bond ETF (NYSE: <a class="ticker" href="/stock/picb#NYSE">PICB</a>), which focuses more on developed market issues.

 As WisdomTree noted: "Investment-grade, emerging-market corporate bonds have historically offered a significant yield premium compared to similarly rated U.S. corporate securities."

Bottom line: It's still early in EMCB's lifespan to be passing judgment on it, but the fund serves a previously unserved niche and an interesting one at that. Expect rivals to sprout up to challenge EMCB and expect to maintain its dominant AUM position, at least for a while.

Last week AdvisorShares introduced four new actively managed ETFs from two different managers.  Madrona Funds, LLC is the sub-advisor and portfolio manager of three new “Madrona Forward” ETFs while American Wealth Management is the sub-advisor and portfolio manager for the “Meidell Tactical” ETF.  These additions bring the number of actively managed ETF listings to 40.  Despite the high level of interest, <a href="http://investwithanedge.com/5-obstacles-facing-active-etfs" target="_blank">actively managed ETFs still face numerous obstacles</a>.
The three Madrona Forward ETFs were launched 6/21/11 (<a href="http://www.marketwire.com/press-release/AdvisorShares-Set-to-Launch-3-Madrona-Funds-ETFs-1529025.htm" target="_blank">press release</a>) and are managed by Brian Evans, Robert Bauer, and Kristi Henderson.  All three members of the portfolio management team are CPAs whose investment approach is more fully described in the <a href="http://advisorshares.com/system/files/funds/public_docs/Whitepaper_Madrona_052011_0.pdf" target="_blank">Forward-Looking Broad-Market Investing White Paper</a> (pdf).  Further information is below and in the <a href="http://advisorshares.com/system/files/funds/public_docs/AdvisorShares%20Trust%20-%20Madrona%20Prospectus%20_FINAL%20as%20Filed%202_14_11__0.pdf" target="_blank">Madrona Prospectus</a> (pdf).
The AdvisorShares Meidell Tactical Advantage ETF (MATH), launched 6/23/11 (<a href="http://www.marketwire.com/press-release/AdvisorShares-Launches-the-Meidell-Tactical-Advantage-ETF-MATH-1530623.htm" target="_blank">press release</a>), will be managed by Laif Meidell of American Wealth Management.  The MATH strategy, based on a combination of relative strength and moving averages, tries to increase exposure to stronger areas of the market and shift to defensive positions when markets decline.  The new ETF is described below (following the three Madrona Forward ETFs).
AdvisorShares Madrona Forward Domestic ETF (FWDD) seeks to provide long-term capital appreciation above the S&P 500 Index by selecting a portfolio of up to 500 of the largest U.S. traded equity securities.  It uses a weighted allocation system based on consensus analyst estimates of the present value of future expected earnings relative to the share price of each security.
The largest sector allocations are Consumer Discretionary 19%, Technology 17%, and Financials 15%.  FWDD currently holds about 480 stocks, all with allocations of less than 0.5% each.  The expense ratio estimate is 1.12% with a 1.25% cap.  Additional data is located in <a href="http://advisorshares.com/fund/fwdd" target="_blank">FWDD overview</a> and <a href="http://advisorshares.com/system/files/funds/public_docs/FWDD_FS_06202011.pdf" target="_blank">FWDD fact sheet</a> (pdf).
AdvisorShares Madrona Forward International ETF (FWDI) seeks to provide long-term capital appreciation above the MSCI EAFE Index and the BNY Mellon Classic ADR Index by selecting a portfolio primarily composed of at least 250 of the largest American Depositary Receipts (ADRs) from EAFE countries, Canada, and emerging markets.
FWDI currently has about 76% exposure to developed markets and 24% to emerging markets.  Regional allocations include Europe 50%, Pacific/Asia 40%, Americas 6%, and Africa/Middle East 4%.  FWDI presently holds about 260 stocks and ADRs, all with allocations of less than 0.8%.  The expense ratio estimate is 1.12% with a 1.25% cap.  Additional data is located in the <a href="http://advisorshares.com/fund/fwdi" target="_blank">FWDI overview</a> and <a href="http://advisorshares.com/system/files/funds/public_docs/FWDI_FS_06202011.pdf" target="_blank">FWDI fact sheet</a> (pdf).
AdvisorShares Madrona Forward Global Bond (FWDB) seeks investment results that exceed the price and yield performance of the Barclays Capital Aggregate Bond Index by selecting a diversified portfolio of fixed income, currency, and commodity pool exchange-traded products (ETPs).  FWDB uses a “fund of funds” approach and invests in at least 12 distinct global bond classes.  The manager uses a weighted allocation system based on historic yield curve analysis and a mean reversion strategy.
FWDB currently holds 16 ETFs with the largest allocations going to iShares iBoxx $ Investment Grade Corporate Bond (<a class="ticker" href="/stock/lqd#">LQD</a>) 18.1%, Vanguard Mortgage Backed Securities ETF (<a class="ticker" href="/stock/vmbs#">VMBS</a>) 14.1%, iShares iBoxx $ High Yield Corporate Bond (<a class="ticker" href="/stock/hyg#">HYG</a>) 13.2%, PowerShares International Corporate Bond (<a class="ticker" href="/stock/picb#">PICB</a>) 8.0%, and Vanguard Intermediate-Term Government Bond ETF (VGIT) 5.0%.  The expense ratio is capped at 1.15% assuming the acquired fund fees do not exceed 0.20%.  Additional data is located in the <a href="http://advisorshares.com/fund/fwdb" target="_blank">FWDB overview</a> and <a href="http://advisorshares.com/system/files/funds/public_docs/FWDB_FS_06202011.pdf" target="_blank">FWDB fact sheet</a> (pdf).
AdvisorShares Meidell Tactical Advantage ETF (MATH) seeks to provide long-term capital appreciation and capital preservation with a  strategy that can dynamically rebalance the portfolio from as much as 100% equity assets to 100% fixed income assets or cash, depending on market trends.  MATH is a “fund-of-funds” that seeks to minimize portfolio losses by rotating out of higher volatility assets and into lower volatility asset classes.
MATH is currently in a defensive posture with a Fixed Income allocation of 57%, Cash 14%, US Equities 24%, and Commodities 4%.  The fund has 17 holdings with the largest being Cash 14.1%, SPDR Barclays TIPS ETF (<a class="ticker" href="/stock/ipe#">IPE</a>) 9.6%, iShares Barclays TIPS Fund (<a class="ticker" href="/stock/tip#">TIP</a>) 9.6%, Vanguard Intermediate-Term Bond ETF (<a class="ticker" href="/stock/biv#">BIV</a>) 4.8%, and iShares S&P Small Cap 600 Index Fund (<a class="ticker" href="/stock/ijr#">IJR</a>) 4.8%.  The gross expense ratio is 2.20% but will be capped at 1.60%.  Additional data is located in the <a href="http://advisorshares.com/fund/math" target="_blank">MATH overview</a>, <a href="http://advisorshares.com/system/files/funds/public_docs/MATH_FS_06222011.pdf" target="_blank">MATH fact sheet</a> (pdf), and the <a href="http://advisorshares.com/system/files/funds/public_docs/AdvisorShares%20-%20Meidell%20Tactical%20ETF%20Prospectus%20dated%20June%206%2C%202011%20-%20FINAL.pdf" target="_blank">MATH Prospectus</a> (pdf).
Disclosure covering writer, editor, and publisher:  No positions in any of the securities mentioned.  No positions in any of the companies or ETF sponsors mentioned.  No income, revenue, or other compensation (either directly or indirectly) received from, or on behalf of, any of the companies or ETF sponsors mentioned.
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When it comes to corporate bond ETFs, for better or worse, the discussion seems to begin and end with the iShares iBoxx $ Investment Grade Corporate Bond Fund (NYSE: <a class="ticker" href="/stock/lqd#NYSE">LQD</a>). That's not surprising as LDQ is simply the juggernaut of this ETF genre. Almost nine years old, LQD has amassed nearly $14 billion in assets under management.

That's quite studly, but there are other options in the corporate bond arena to consider, particularly for the investor looking for some international exposure. For those craving some global, high-grade corporate bond fare today's “Under the Hood” candidate, the PowerShares International Corporate Bond Portfolio (NYSE: <a class="ticker" href="/stock/picb#NYSE">PICB</a>) is worth a look.

As it turns out, PICB celebrated its first birthday last week and in its 53 weeks of trading, the ETF has done pretty well for itself, hauling in nearly $55 million in AUM. With an expense ratio of 0.5% and 168 holdings, PICB focuses on high-grade corporate debt issues denominated in Australian dollars, British pounds, euros, Canadian dollars, Japanese yen and Swedish krona, among other non-dollar currencies.

Along those lines, it should come as no surprise that PICB focuses almost exclusively on developed markets. British corporate bonds account for over 17% of the ETF's weight while France chimes in at over 8%. Italy and Germany both get weights above 7%.

Despite the international bias, PICB is home to bonds from issuers most American investors have at least heard of such as Barclays (NYSE: <a class="ticker" href="/stock/bcs#NYSE">BCS</a>), Bank of Nova Scotia (NYSE: <a class="ticker" href="/stock/bns#NYSE">BNS</a>), France Telecom (NYSE: <a class="ticker" href="/stock/fte#NYSE">FTE</a>) and Telefonica (NYSE: <a class="ticker" href="/stock/tef#NYSE">TEF</a>).

With a distribution yield of 3.66%, PICB certainly represents a better option than a money market or a CD, not to mention the ETF is optionable, presenting investors with another avenue for generating income. PICB's yield to maturity and yield to worst are both 4.28%.

Alright, so we've packed a lot of statistics into this edition of “Under the Hood,” but the most important statistic of all highlights why investors may want to consider PICB before LQD. The PowerShares offering is up 6.4% year-to-date, nearly triple the returns offered by the bigger, more popular LQD.

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