I would also like to know 'source of information' that they are not holding them to maturity. 'http://www.claymoreinvestments.ca/etf/fund/clf' here they show a picture where it seems like to me that maturing bond is being replaced by new 5 year bond ladder. Though I am not able to find an explicit reference to this fact or otherwise
You could also call them to get clarification. I may also call, as I have a vested interest in this. Maybe we could both call and post the response we get to see if they match.
This is what I found reading the website and prospectus (well skimming the latter):
From their website:
"As the name suggests, a laddered bond portfolio is made up of several fixed income holdings, each having a successively longer term to maturity.
Bonds close to maturity are reinvested back out at the long end (i.e. at the top of the “ladder”) which will result in continuous rolling of the portfolio."
What does "Bonds close to maturity" really mean, they have matured, or they are almost matured?
Page 6 of prospectus:
Claymore 1-5 Yr Laddered Government Bond ETF
The Claymore 1-5 Yr Laddered Government Bond ETF seeks investment results that correspond generally to the price and yield (before fees and expenses) of the DEX 1-5 Year Laddered Government Bond Index. The investment strategy of the Claymore 1-5 Yr Laddered Government Bond ETF is to invest in and hold Constituent Securities of the DEX 1-5 Year Laddered Government Bond Index in substantially the same proportion as they are reflected in that Index. The Claymore 1-5 Yr Laddered Government Bond ETF has been structured to provide exposure to the staggered maturity dates of the bonds in the underlying Index, which range from one to five years.
Claymore 1-5 Yr Laddered Corporate Bond ETF
The Claymore 1-5 Yr Laddered Corporate Bond ETF seeks investment results that correspond generally to the price and yield (before fees and expenses) of the DEX 1-5 Year Laddered Corporate Bond Index. The investment strategy of the Claymore 1-5 Yr Laddered Corporate Bond ETF is to invest in and hold Constituent Securities of the DEX 1-5 Year Laddered Corporate Bond Index in substantially the same proportion as they are reflected in that Index. The Claymore 1-5 Yr Laddered Corporate Bond ETF has been structured to provide exposure to the staggered maturity dates of the bonds in the underlying Index, which range from one to five years.
Page 15 of prospectus:
DEX 1-5 Year Laddered Government Bond Index
The DEX 1-5 Year Laddered Government Bond Index, is an equally weighted benchmark index that measures potential returns of a theoretical portfolio of Canadian treasury and corporate securities with a yield curve based upon five distinct annual maturities. The DEX 1-5 Year Laddered Government Bond Index seeks to maintain a continuous maturity laddered portfolio of approximately 25 securities,
meaning that securities holdings are scheduled to mature in a proportional, annual sequential pattern.
DEX 1-5 Year Laddered Corporate Bond Index
The DEX 1-5 Year Laddered Corporate Bond Index is an equally weighted benchmark index that measures potential returns of a theoretical portfolio of Canadian corporate securities with a yield curve based upon five distinct annual groupings of maturity. The DEX 1-5 Year Laddered Corporate Bond Index seeks to maintain a continuous maturity laddered portfolio of approximately 25 securities,
meaning that securities holdings are scheduled to mature in a proportional, annual sequential pattern.
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To me, the real question is, regardless of whether it is a true laddered fund or a simulated one, what is the difference to the investor? Are there no significant differences?
. I would like to get opinion of other members about this ETF.
