LQDH: This Hedging Strategy Is Effective But Likely Useless Now

iShares Interest Rate Hedged Corporate Bond ETF combines LQD exposure with swaps, resulting in near-zero duration. The hedging strategy has worked very well in 2022 when rates surged the most. Despite its effectiveness, LQDH now appears less compelling as rate pressures ease, especially given LQD's lower expense ratio.

Seeking Alpha • Oct 6, 2025

These bond funds shield you from interest-rate shocks — but here's the catch

Insurance against Fed rate hikes with “rate-hedged” ETFs doesn't come cheap.

Market Watch • May 9, 2025

What's Going On With Treasury Rates?

We think the Fed has time to assess the impact of tariffs, and we expect it to wait to cut rates until the data show that tariffs are impacting the real economy. So far, there are no signs of recession in the hard data. The tariff pause offers the possibility to avoid worst-case economic scenarios before the damage is crystalized. We believe technical factors will continue to drive market dislocations in spreads and sectors, and that active managers can navigate this more effectively.

Seeking Alpha • Apr 18, 2025

These ETFs can be your insurance against Fed hikes and rising rates

“Rate-hedged” bond funds can make money when interest rates rise and bond prices fall.

Market Watch • Dec 17, 2024

LQDH: Checking In On Hedged Investment Grade Bonds (Rating Upgrade)

We initially rated LQDH a 'Sell' due to its zero duration profile, making it less beneficial in a falling rate environment. LQD outperformed LQDH by 4% as expected as the Fed announced its intent to cut Fed Funds. LQD benefited from lower intermediate rates, confirming our initial thesis. With the yield curve shift largely behind us, we are upgrading LQDH to 'Hold', anticipating similar performance to LQD in a range-bound rate environment.

Seeking Alpha • Sep 26, 2024

LQDH: Investment-Grade Bond ETF, Interest Rate Hedged, Good 6.6% Yield

LQDH is an interest rate hedged investment-grade corporate bond index ETF managed by BlackRock. It provides investors with diversified exposure to investment-grade corporate bonds, and uses swaps to hedge its interest rate risk. It has significantly outperformed its peers since inception, and with lower risk and volatility.

Seeking Alpha • May 29, 2024

How to immunize your bond ETF if interest rates turn back up

The best time to buy insurance is when whatever it is you're insuring against is considered unlikely. So, should you hedge your bond portfolio against rising interest rates?

Market Watch • May 17, 2024

LQDH: A Corporate Spreads Play (Rating Downgrade)

iShares Interest Rate Hedged Corporate Bond ETF is a fixed income ETF that hedges against rising interest rates. LQDH isolates corporate credit spreads and gains when spreads tighten, but loses value when spreads widen. Investment grade corporate spreads are currently at historic lows, indicating a potential future widening and lower NAV for LQDH.

Seeking Alpha • Mar 19, 2024

The Credit Opportunity In M&A

M&A was almost dormant in 2023. In the US, as a proportion of the market value of the benchmark equity indices, it fell to its lowest level in 20 years, according to McKinsey. Credit investors are not traditionally supposed to be fans of M&A, and it's true we are wary of leveraging M&A, where debt is loaded onto balance sheets to buy competitors. We are seeing a comeback for M&A that we think is likely to continue through 2024.

Seeking Alpha • Mar 4, 2024

LQDH: A Hedge For The Fed Not Pivoting

Bond funds that hedge interest rate risk have performed better than those that don't in recent years. The iShares Interest Rate Hedged Corporate Bond ETF is a cost-effective option for investors seeking interest rate hedged exposure to investment-grade corporate bonds. The LQDH ETF offers a unique blend of features, including investment-grade corporate bond exposure with interest rate hedging, setting it apart from similar ETFs.

Seeking Alpha • Jan 4, 2024