CTBC US High Grade Municipal Bond ETF (00847B)

Overview

The CTBC US High Grade Municipal Bond ETF is a specialized exchange-traded fund that offers investors the opportunity to invest in high-quality U.S. municipal and government bonds through a single, streamlined investment. Founded on July 30, 2019, this ETF employs a passive, market value-weighted strategy to manage its investments. It aims to replicate the performance of the Bloomberg Long Term US Treasury and High Grade Municipal Bond Index, which consists of investment grade securities. The ETF’s focus on long-term government and municipal bonds, all denominated in U.S. dollars, positions it as an attractive option for both domestic and international investors seeking stable returns and regular income from high-grade U.S. fixed income assets. With a diversified portfolio of more than 50 holdings, the fund emphasizes credit quality and risk management, catering to investors looking for a combination of income generation and a relatively low-risk investment within the broader fixed income market.

Products and Services

• Investment in High-Quality Government and Municipal Bonds

This fund primarily targets long-term investment grade securities, ensuring a focus on high-quality U.S. government and municipal bonds. By strategically investing in these instruments, the ETF provides a dependable source of quarterly income, primarily appealing to income-focused investors who prioritize safety and creditworthiness in their investments. The meticulous selection of bonds aims to secure a stable and consistent dividend yield, meeting the income requirements of conservative investors while also catering to those looking to diversify their portfolio with fixed income assets.

• Replication of Bloomberg Long Term US Treasury and High Grade Municipal Bond Index

CTBC US High Grade Municipal Bond ETF seeks to mirror the performance of the Bloomberg Long Term US Treasury and High Grade Municipal Bond Index. This strategy involves a comprehensive and passive approach toward investment, where the fund's composition reflects the index's array of investment grade, long-term U.S. treasury, and municipal bonds. This index replication aims to achieve an investment performance similar to that of the underlying index, thereby providing investors with a transparent, diversified, and performance-oriented investment option within the fixed income category.

• Quarterly Dividend Payments

One of the key features of the CTBC US High Grade Municipal Bond ETF is its provision of regular quarterly dividends. This characteristic is specifically tailored to meet the needs of investors who seek a steady stream of income from their investments. The dividends are supported by the fund’s consistent dividend yield, making it an ideal choice for retirees, income-focused investors, and those who prefer the predictability of receiving regular income distributions from their investment in high-grade, low-risk municipal and treasury bonds.

• Diversification and Risk Management

The diverse portfolio of over 50 individual holdings across long-term government and municipal bonds allows the CTBC US High Grade Municipal Bond ETF to offer a balanced mix of investments. This diversification serves as a fundamental risk management tool, mitigating sector-specific and market-wide risks. By distributing investments across various high-grade bonds, the ETF minimizes the impact of volatility on its overall portfolio, making it a secure and stable investment option for those looking to balance risk and return in their investment portfolios.