iShares 1-5 yr Ladder Corp Bond ETF

CBO-T

Analysis and Opinions about CBO-T

Signal
Opinion
Expert
HOLD
HOLD
June 10, 2019
Short vs. long term bonds. Generally as the expectation comes for rate hikes, you want longer term bonds. You don’t want corporate because if the economic slows, you just want government bonds.
Short vs. long term bonds. Generally as the expectation comes for rate hikes, you want longer term bonds. You don’t want corporate because if the economic slows, you just want government bonds.
Larry Berman CFA, CMT, CTA
Chief Investment Officer, Partner, ETF Capital Management Inc.
Price
$18.660
Owned
Unknown
WATCH
WATCH
September 25, 2017

A laddered bond portfolio. He likes it. Each ETF provider’s version has had bad performance over the last few months because short term yields are seen as rising. The risk is if the BOC is more aggressively tightening. You want to wait until after the next announcement when there may be another pull back and then perhaps get in.

A laddered bond portfolio. He likes it. Each ETF provider’s version has had bad performance over the last few months because short term yields are seen as rising. The risk is if the BOC is more aggressively tightening. You want to wait until after the next announcement when there may be another pull back and then perhaps get in.

Larry Berman CFA, CMT, CTA
Chief Investment Officer, Partner, ETF Capital Management Inc.
Price
$18.500
Owned
Unknown
BUY
BUY
April 10, 2017

This is a short term laddered bond portfolio up to 5 years. The bonds are trading at a premium, generally. Long term you get a decline in the price. The yield to maturity is closer to 2%. The real return is positive even though the valuation goes down over time. Generally it is a very safe instrument.

This is a short term laddered bond portfolio up to 5 years. The bonds are trading at a premium, generally. Long term you get a decline in the price. The yield to maturity is closer to 2%. The real return is positive even though the valuation goes down over time. Generally it is a very safe instrument.

Larry Berman CFA, CMT, CTA
Chief Investment Officer, Partner, ETF Capital Management Inc.
Price
$18.990
Owned
Unknown
COMMENT
COMMENT
January 13, 2017

Short-term corporate bonds, ZCS-T or CBO-T? They both have very similar holdings. This one weights bonds with a traditional laddering strategy, whereas ZCS-T weights the bonds in the portfolio related to the size they have in the market. It is really hard to say which is better, because all bond ETF’s are ladders of a sort.

Short-term corporate bonds, ZCS-T or CBO-T? They both have very similar holdings. This one weights bonds with a traditional laddering strategy, whereas ZCS-T weights the bonds in the portfolio related to the size they have in the market. It is really hard to say which is better, because all bond ETF’s are ladders of a sort.

Daniel Straus
Head of ETF Research & Strategy, National Bank Financial
Price
$18.920
Owned
Unknown
COMMENT
COMMENT
April 25, 2016

A Blackrock bond fund for an 81-year-old? He doesn’t know this corporate ETF, but ETF’s are a good idea because they are very low cost. He would recommend going into a government bond ETF, and put it out across the entire curve, 2 to 30 years. Then you could look at another ETF, that would perhaps have some corporate bonds in order to give you a little bit more yield.

A Blackrock bond fund for an 81-year-old? He doesn’t know this corporate ETF, but ETF’s are a good idea because they are very low cost. He would recommend going into a government bond ETF, and put it out across the entire curve, 2 to 30 years. Then you could look at another ETF, that would perhaps have some corporate bonds in order to give you a little bit more yield.

Paul Tepsich
Portfolio Manager, High Rock Capital Management Inc.
Price
$19.060
Owned
No
COMMENT
COMMENT
October 21, 2015

The problem with this is, where is the yield coming from? Quite often when you are looking at yields, there are premium priced bonds in there. This one is quoted as paying 4%. What you need to look at is the yield to maturity. This can be found on the website.

The problem with this is, where is the yield coming from? Quite often when you are looking at yields, there are premium priced bonds in there. This one is quoted as paying 4%. What you need to look at is the yield to maturity. This can be found on the website.

John Hood
President & Portfolio Manager, J. C Hood Investment.
Price
$19.240
Owned
Unknown
COMMENT
COMMENT
August 24, 2015

Relatively good and safe investment? For conservative investors right now, short-term corporate bonds are the way to play the fixed income market.

Relatively good and safe investment? For conservative investors right now, short-term corporate bonds are the way to play the fixed income market.

Larry Berman CFA, CMT, CTA
Chief Investment Officer, Partner, ETF Capital Management Inc.
Price
$19.430
Owned
Unknown
DON'T BUY
DON'T BUY
August 17, 2015

Everything he said about iShares 1-5 yr Government Bond ETF (CLF-T) are equally true for this, only you are going further out on the yield curve. Corporate bonds are riskier than government bonds with the added risk of this one’s underlying basket of securities being more volatile. This is a sort of thing that is going to grind down the NAV. It is fine as a cash-park, but if it were him he would literally use cash instead.

Everything he said about iShares 1-5 yr Government Bond ETF (CLF-T) are equally true for this, only you are going further out on the yield curve. Corporate bonds are riskier than government bonds with the added risk of this one’s underlying basket of securities being more volatile. This is a sort of thing that is going to grind down the NAV. It is fine as a cash-park, but if it were him he would literally use cash instead.

John DeGoey
Portfolio Manager, Wellington-Altus Private Wealth Inc.
Price
$19.510
Owned
Unknown
BUY
BUY
August 10, 2015

He would recommend this as a core holding in the bond portion of a balanced portfolio. He thinks this is the area of the market that people should concentrate their fixed income holding on a 1-5 year term to protect capital . He is a laddered advocate and this is a good quality laddered index and has around 60 bonds in it. He likes it.

He would recommend this as a core holding in the bond portion of a balanced portfolio. He thinks this is the area of the market that people should concentrate their fixed income holding on a 1-5 year term to protect capital . He is a laddered advocate and this is a good quality laddered index and has around 60 bonds in it. He likes it.

Hank Cunningham
Fixed Income Strategist, Odlum Brown Limited
Price
$19.480
Owned
Unknown
COMMENT
COMMENT
April 13, 2015

If you own, the first thing you should look at is, what you think your yield is. Then look at what it actually is. You do this by going on to their website and looking at the “yield to maturity”. Then make a decision from there. He likes the idea of the laddered corporate bond index, but we know that if they are doing better than the 10 year government rate, there has to be a reason. If so, he would suspect there are some premium bonds that will mature at par.

If you own, the first thing you should look at is, what you think your yield is. Then look at what it actually is. You do this by going on to their website and looking at the “yield to maturity”. Then make a decision from there. He likes the idea of the laddered corporate bond index, but we know that if they are doing better than the 10 year government rate, there has to be a reason. If so, he would suspect there are some premium bonds that will mature at par.

John Hood
President & Portfolio Manager, J. C Hood Investment.
Price
$19.740
Owned
No
COMMENT
COMMENT
February 17, 2015

Quoted as having a 4%+ yield, but the website shows a yield to maturity of about 1%. How come? Even with really good ETF’s like this, you have to ask Why. They are not expanding the risk nor the duration of the bond portfolio, so how do they get those yields? They are paying $105 for a bond that has a higher yield. The trouble is, when those bonds mature, you are only getting $100 for them, so there is a built-in capital loss. It is very important to go to the website and take a look at the yield to maturity and the duration of the portfolio.

Quoted as having a 4%+ yield, but the website shows a yield to maturity of about 1%. How come? Even with really good ETF’s like this, you have to ask Why. They are not expanding the risk nor the duration of the bond portfolio, so how do they get those yields? They are paying $105 for a bond that has a higher yield. The trouble is, when those bonds mature, you are only getting $100 for them, so there is a built-in capital loss. It is very important to go to the website and take a look at the yield to maturity and the duration of the portfolio.

John Hood
President & Portfolio Manager, J. C Hood Investment.
Price
$19.780
Owned
Unknown
BUY
BUY
November 20, 2014

Likes the 1-5 year corporate laddered ETF. It is a nice, safe ETF and you will get the kind of returns that he has shown in Past Picks. This is better than cash and is very safe.

Likes the 1-5 year corporate laddered ETF. It is a nice, safe ETF and you will get the kind of returns that he has shown in Past Picks. This is better than cash and is very safe.

Hank Cunningham
Fixed Income Strategist, Odlum Brown Limited
Price
$19.540
Owned
No
COMMENT
COMMENT
November 20, 2014

iShares 1-5 yr Ladder Corp Bond ETF (CBO-T) or iShares 1-5 yr Government Bond ETF (CLF-T)? He prefers this one because the risk is very low and it is a very well diversified short-term portfolio and will give you extra yield over time over the government one. If safety of capital is paramount, then he would suggest half-and-half.

iShares 1-5 yr Ladder Corp Bond ETF (CBO-T) or iShares 1-5 yr Government Bond ETF (CLF-T)? He prefers this one because the risk is very low and it is a very well diversified short-term portfolio and will give you extra yield over time over the government one. If safety of capital is paramount, then he would suggest half-and-half.

Hank Cunningham
Fixed Income Strategist, Odlum Brown Limited
Price
$19.540
Owned
Unknown
BUY
BUY
November 10, 2014

More short term and corporate exposure. A good fit for a conservative investor especially in a tax sheltered account.

More short term and corporate exposure. A good fit for a conservative investor especially in a tax sheltered account.

Joey Mack
Director, Fixed Income, ScotiaCapital
Price
$19.540
Owned
Unknown
COMMENT
COMMENT
October 6, 2014

A laddered bond fund can reduce your exposure using shorter durations. The average is about 2.5 years. It reduces your return, but reduces your exposure to rising interest rates. A lot of funds use preferred shares instead of bonds.

A laddered bond fund can reduce your exposure using shorter durations. The average is about 2.5 years. It reduces your return, but reduces your exposure to rising interest rates. A lot of funds use preferred shares instead of bonds.

Mike MacBain
Founding Partner, East Coast Funds Management
Price
$19.550
Owned
Unknown
PARTIAL SELL
PARTIAL SELL
September 4, 2014

Conservative corporate bond strategy, only out 5 years which is where you want to be. Losses over the next couple of years should be cushioned.

Conservative corporate bond strategy, only out 5 years which is where you want to be. Losses over the next couple of years should be cushioned.

Joey Mack
Director, Fixed Income, ScotiaCapital
Price
$19.610
Owned
Unknown
DON'T BUY
DON'T BUY
July 18, 2014

The problem is, how do you deal with these premium bonds. Very limiting in terms of what you can do to manage that portfolio. He would be more inclined to go towards something that has a broader and much more diversified bond portfolio. He would look at the iShares Cdn Short Term Bond (XSB-T).

The problem is, how do you deal with these premium bonds. Very limiting in terms of what you can do to manage that portfolio. He would be more inclined to go towards something that has a broader and much more diversified bond portfolio. He would look at the iShares Cdn Short Term Bond (XSB-T).

John Hood
President & Portfolio Manager, J. C Hood Investment.
Price
$19.720
Owned
No
COMMENT
COMMENT
May 26, 2014

Writing naked puts to keep a fair bit of US/Cdn cash on hand. Concerned about rising interest rates. What about high yield bond funds? He would not put it in a high-yield bond fund because, in effect, what you are doing is cash securing a put option that you’ve sold. CBO is a good place and there’s nothing wrong with this. An interesting product only because the portfolio tends to be holding longer-term bonds issued by banks and credit worthy customers, but they are callable bonds within 5 years. CBD-T is another product you could use.

Writing naked puts to keep a fair bit of US/Cdn cash on hand. Concerned about rising interest rates. What about high yield bond funds? He would not put it in a high-yield bond fund because, in effect, what you are doing is cash securing a put option that you’ve sold. CBO is a good place and there’s nothing wrong with this. An interesting product only because the portfolio tends to be holding longer-term bonds issued by banks and credit worthy customers, but they are callable bonds within 5 years. CBD-T is another product you could use.

Richard Croft
President, R.N. Croft Financial Group Inc.
Price
$19.730
Owned
Unknown
COMMENT
COMMENT
May 1, 2014

Likes this as a concept idea, but there is no single income product out there that he genuinely likes. This has been pretty much flat now for 6 months. In the rate cycle, he is struggling and using equity linked GICs in his own practice.

Likes this as a concept idea, but there is no single income product out there that he genuinely likes. This has been pretty much flat now for 6 months. In the rate cycle, he is struggling and using equity linked GICs in his own practice.

John DeGoey
Portfolio Manager, Wellington-Altus Private Wealth Inc.
Price
$19.750
Owned
Unknown
WEAK BUY
WEAK BUY
April 28, 2014

Stock vs. Stock: XTR or CBO. Laddered fixed income. The yield is lower and the cost is higher than XTR.

Stock vs. Stock: XTR or CBO. Laddered fixed income. The yield is lower and the cost is higher than XTR.

Larry Berman CFA, CMT, CTA
Chief Investment Officer, Partner, ETF Capital Management Inc.
Price
$19.730
Owned
Unknown
BUY
BUY
April 21, 2014

Based on Bank of Canada statements, we are probably not going to see an interest rate hike in the next 12 months, but it is also about how the US handles the next year. Once the Fed really pulls back on QE, the economy will falter and interest rates won’t go up there either. This one is a fine holding. Don’t worry about the underlying volume, as long as it trades with a penny or two spread.

Based on Bank of Canada statements, we are probably not going to see an interest rate hike in the next 12 months, but it is also about how the US handles the next year. Once the Fed really pulls back on QE, the economy will falter and interest rates won’t go up there either. This one is a fine holding. Don’t worry about the underlying volume, as long as it trades with a penny or two spread.

Larry Berman CFA, CMT, CTA
Chief Investment Officer, Partner, ETF Capital Management Inc.
Price
$19.780
Owned
Unknown
COMMENT
COMMENT
February 6, 2014

iShares DEX Universe Bond (XBB-T) or iShares 1-5yr Laddered Corp Bond Fund (CBO-T) for the best long-term hold? These are 2 very different things. The XBB would have lost you money. It is two thirds government and one third corporate. Has about 750 names and would’ve lost about 1.5% last year with a yield of about 3%. The CBO is short in duration with a yield of around 4% and the duration of about 3 with about 45 names in it. It is laddered 1 to 5 years and this is his preference if you must be in bonds.

iShares DEX Universe Bond (XBB-T) or iShares 1-5yr Laddered Corp Bond Fund (CBO-T) for the best long-term hold? These are 2 very different things. The XBB would have lost you money. It is two thirds government and one third corporate. Has about 750 names and would’ve lost about 1.5% last year with a yield of about 3%. The CBO is short in duration with a yield of around 4% and the duration of about 3 with about 45 names in it. It is laddered 1 to 5 years and this is his preference if you must be in bonds.

Mike S. Newton, CIM FCSI
Director & Portfolio Manager, Scotia Wealth Management
Price
$19.800
Owned
Yes
COMMENT
COMMENT
December 19, 2013

Basically a 1-5 year laddered corporate bond portfolio, so you are buying corporate bonds. In theory they have short-terms to maturity. If looking at fixed income instruments throughout next year and probably the next couple of years, you want to keep your duration short. This fund yields more than you would expect given the short 1-5 year terms. This is because the manager of the fund is buying longer-term bonds, where the Call dates are 1 to 5 years. Most of those particular bonds, high-quality, are virtually all called within the 5 years. Good fund.

Basically a 1-5 year laddered corporate bond portfolio, so you are buying corporate bonds. In theory they have short-terms to maturity. If looking at fixed income instruments throughout next year and probably the next couple of years, you want to keep your duration short. This fund yields more than you would expect given the short 1-5 year terms. This is because the manager of the fund is buying longer-term bonds, where the Call dates are 1 to 5 years. Most of those particular bonds, high-quality, are virtually all called within the 5 years. Good fund.

Richard Croft
President, R.N. Croft Financial Group Inc.
Price
$19.760
Owned
Unknown
BUY
BUY
December 17, 2013

This is a major holding of his. Surprisingly, for all the interest-rate rise we have been worried about all summer, it hasn’t been that bad. This is in the corporate sector, rather than the government. He is starting to look for alternative managers in the corporate bond space and you may want to look at some active managers rather than an ETF. If you are willing to put up with a little volatility in the near-term, it is a great little play.

This is a major holding of his. Surprisingly, for all the interest-rate rise we have been worried about all summer, it hasn’t been that bad. This is in the corporate sector, rather than the government. He is starting to look for alternative managers in the corporate bond space and you may want to look at some active managers rather than an ETF. If you are willing to put up with a little volatility in the near-term, it is a great little play.

Mike S. Newton, CIM FCSI
Director & Portfolio Manager, Scotia Wealth Management
Price
$19.790
Owned
Yes
BUY
BUY
October 10, 2013

BMO Canadian Dividend ETF (ZDV-T) or iShares 1-5 Yr Ladder Corp Bond ETF (CBO-T) for income, not so much increase, but also for a big downturn? He would go half and half. This one is a laddered 1-5 years corporate bond. What is interesting is that the yield is higher than one would expect on a 1 to 5 year laddered corporate bond portfolio. They are effectively buying longer-term bonds, but they are looking at and tracking the duration to the Call date of the bonds.

BMO Canadian Dividend ETF (ZDV-T) or iShares 1-5 Yr Ladder Corp Bond ETF (CBO-T) for income, not so much increase, but also for a big downturn? He would go half and half. This one is a laddered 1-5 years corporate bond. What is interesting is that the yield is higher than one would expect on a 1 to 5 year laddered corporate bond portfolio. They are effectively buying longer-term bonds, but they are looking at and tracking the duration to the Call date of the bonds.

Richard Croft
President, R.N. Croft Financial Group Inc.
Price
$19.680
Owned
Unknown
DON'T BUY
DON'T BUY
September 9, 2013

What will rising interest rates do to this ETF’s dividends? Doesn’t matter what it is, this is an environment that is going to hurt bonds. Likes this one and has used it in the past until about 1.5 years ago but he can no longer justify using any kind of a bond ETF in his portfolio if he can help it.

What will rising interest rates do to this ETF’s dividends? Doesn’t matter what it is, this is an environment that is going to hurt bonds. Likes this one and has used it in the past until about 1.5 years ago but he can no longer justify using any kind of a bond ETF in his portfolio if he can help it.

John DeGoey
Portfolio Manager, Wellington-Altus Private Wealth Inc.
Price
$19.610
Owned
Unknown
COMMENT
COMMENT
August 30, 2013

Very heavily weighted in banks. The one problem with this is that there are relatively few bonds in it. His issue would be the price paid for some of the bonds. You have to look at the quoted yield relative to the yield to maturity. If there is a big discrepancy, you might want to look at easing up on this a bit. He wouldn’t have this in his portfolio because he likes banks through the Covered Calls.

Very heavily weighted in banks. The one problem with this is that there are relatively few bonds in it. His issue would be the price paid for some of the bonds. You have to look at the quoted yield relative to the yield to maturity. If there is a big discrepancy, you might want to look at easing up on this a bit. He wouldn’t have this in his portfolio because he likes banks through the Covered Calls.

John Hood
President & Portfolio Manager, J. C Hood Investment.
Price
$19.740
Owned
No
COMMENT
COMMENT
August 13, 2013

What happens to the value of this, assuming that interest rates stay in a tight range for the next 5 years? If yields stay in the general range, the 1 to 5 years ladder will perpetually drop off the shortest bond and replace it with bonds maturing in the 4-5 year bucket. The performance of this one will change marginally on the steepness of the 1-5 year part of the curve. The steeper the curve, you will be picking up more yield as you drop off the old bond.

What happens to the value of this, assuming that interest rates stay in a tight range for the next 5 years? If yields stay in the general range, the 1 to 5 years ladder will perpetually drop off the shortest bond and replace it with bonds maturing in the 4-5 year bucket. The performance of this one will change marginally on the steepness of the 1-5 year part of the curve. The steeper the curve, you will be picking up more yield as you drop off the old bond.

James Dutkiewicz
Chief Inv Strategist & Sr. Portfolio Manager, Sentry Investments
Price
$19.790
Owned
Unknown
COMMENT
COMMENT
May 6, 2013

Laddered corporate bond exposure. CBO-T 1-five-year ladder or CBH-T 1-10 year ladder? He prefers the 1-10 year ladder because for one thing, the yield spread between 5 and 10 year bonds has averaged over 1% for the last 25 years so if you stop at 5 years, you are giving up a lot of extra yield. Also, you can diversify more by credit. Five-year is really too short.

Laddered corporate bond exposure. CBO-T 1-five-year ladder or CBH-T 1-10 year ladder? He prefers the 1-10 year ladder because for one thing, the yield spread between 5 and 10 year bonds has averaged over 1% for the last 25 years so if you stop at 5 years, you are giving up a lot of extra yield. Also, you can diversify more by credit. Five-year is really too short.

Hank Cunningham
Fixed Income Strategist, Odlum Brown Limited
Price
$20.110
Owned
Unknown
COMMENT
COMMENT
March 21, 2013

Is iShares S&P/TSX Preferred Fund (CPD-T) or iShares 1-5 Yr Laddered Corp Bond Fund (CBO-T) better for safety for a retiree? This is not apples to apples. He likes CPD better. Feels there is a fair amount of risk in bonds. If there is a situation where there is corporate province not being as good, then CPD could go down more quickly than bonds. Both of them have been pretty much flat over the last year or 2.

Is iShares S&P/TSX Preferred Fund (CPD-T) or iShares 1-5 Yr Laddered Corp Bond Fund (CBO-T) better for safety for a retiree? This is not apples to apples. He likes CPD better. Feels there is a fair amount of risk in bonds. If there is a situation where there is corporate province not being as good, then CPD could go down more quickly than bonds. Both of them have been pretty much flat over the last year or 2.

John DeGoey
Portfolio Manager, Wellington-Altus Private Wealth Inc.
Price
$20.160
Owned
Unknown
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