NEAR is an actively managed ETF from Blackrock that holds short-term debt instruments in order to generate income. But is it a good investment? I review it here.
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NEAR Methodology and Fees
NEAR from Blackrock aims to limit the volatility of principal while generating income via ultra-short-term global bonds. We'd consider it to be riskier than a savings account but less risky than a total bond market fund.
NEAR launched in late 2013 and has since amassed over $4 billion in assets. NEAR selects the following debt types from around the world: fixed- and floating-rate securities, privately issued, asset-backed, mortgage-backed, structured, munis, repo agreements, and money market securities as well as those issued by banks, broker-dealers and insurance companies. investment-grade bonds with maturities less than 1 year.
NEAR has 362 holdings, an effective duration of about 5 months, a 30-day SEC yield of 4.56%, and an expense ratio of 0.25%.
NEAR Sector Composition
To generate a higher yield, NEAR tends to focus on investment grade industrials. Here's a breakdown of those debt types:
In terms of performance, NEAR has also beaten its category average and its benchmark index, the Bloomberg Govt/Corp 1 Yr Duration TR USD, since inception:
Is NEAR a Good Investment?
So is NEAR a good investment? Maybe.
Blackrock's fixed income team have proven their competency in selecting short duration debt instruments to maximize current income by diversifying broadly across issuers, irrespective of market environment.
I compared NEAR to its closest competitors in a separate post here.
Conveniently, NEAR should be available at any major broker, including M1 Finance, which is the one I'm usually suggesting around here.
What do you think of NEAR? Do you own it? Let me know in the comments.
Disclaimer: While I love diving into investing-related data and playing around with backtests, this is not financial advice, investing advice, or tax advice. The information on this website is for informational, educational, and entertainment purposes only. Investment products discussed (ETFs, mutual funds, etc.) are for illustrative purposes only. It is not a recommendation to buy, sell, or otherwise transact in any of the products mentioned. I always attempt to ensure the accuracy of information presented but that accuracy cannot be guaranteed. Do your own due diligence. All investing involves risk, including the risk of losing the money you invest. Past performance does not guarantee future results. Opinions are my own and do not represent those of other parties mentioned. Read my lengthier disclaimer here.
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