Post by roi2020 on Jul 1, 2023 19:10:46 GMT
There were substantial TIPS ETF inflows from May 2020 through December 2021.
Like many other bond funds, moderate and high duration TIPS ETFs experienced large declines in 2022.
For example, 2022 returns for TIP, SCHP, and LTPZ were -12.24%, -12.02%, and -31.68% respectively.
It's not surprising that investors were disappointed with TIPS performance last year when inflation was high.
"Nearly $17 billion has exited from Treasury-inflation securities ETFs over 10 consecutive months of outflows,
an unprecedented streak in data going back to 2016, Bloomberg Intelligence data show."
"That rush to the exits follows a bruising stretch of underperformance for the asset designed to protect against inflation.
While TIPS weather against price erosion, real yields — which strip out the impact of inflation —
have soared over the past year, shredding returns even as price pressures remain stubbornly high.
That’s soured the appetite of investors who piled into TIP and similar ETFs to curb inflation."
"The distaste for TIPS-tracking ETFs contrasts with reignited demand for the securities in the primary market.
Investors snatched up about 96% of the $19 billion in Treasury Inflation Protected Securities auctioned last week,
leaving less than 4% to firms authorized as primary dealers."
Link
(Bloomberg subscription may be required)
Like many other bond funds, moderate and high duration TIPS ETFs experienced large declines in 2022.
For example, 2022 returns for TIP, SCHP, and LTPZ were -12.24%, -12.02%, and -31.68% respectively.
It's not surprising that investors were disappointed with TIPS performance last year when inflation was high.
"Nearly $17 billion has exited from Treasury-inflation securities ETFs over 10 consecutive months of outflows,
an unprecedented streak in data going back to 2016, Bloomberg Intelligence data show."
"That rush to the exits follows a bruising stretch of underperformance for the asset designed to protect against inflation.
While TIPS weather against price erosion, real yields — which strip out the impact of inflation —
have soared over the past year, shredding returns even as price pressures remain stubbornly high.
That’s soured the appetite of investors who piled into TIP and similar ETFs to curb inflation."
"The distaste for TIPS-tracking ETFs contrasts with reignited demand for the securities in the primary market.
Investors snatched up about 96% of the $19 billion in Treasury Inflation Protected Securities auctioned last week,
leaving less than 4% to firms authorized as primary dealers."
Link
(Bloomberg subscription may be required)