A new ETF category in Europe
In the investment world, traditional asset allocation has long been based on a well-established structure: the so-called ’60/40′ strategy, which consists of investing 60% of assets in equities and 40% in bonds. This allocation, popularised by decades of stable returns, relies on the ability of bonds to provide stability and income to complement the growth potential of equities. The period of low interest rates may have partially challenged this allocation style, but the current return to a higher interest rate environment is more in its favour.
Historically, bond investing has been the preserve of sophisticated investors who have been able to select bonds directly and manage the duration of their portfolios. These investors have to navigate between different brokers to access the liquidity they need, manage the duration of their portfolio and adjust it to interest rate movements.
An alternative is to buy bond funds, which allow management to be delegated, but at the cost of often high fees. The management objective of these funds is to achieve a constant duration in line with a benchmark index. In order to maintain a constant duration, the bond portfolio must be constantly rotated.
The emergence of term bond funds has provided an alternative. These products allow investors to invest in baskets of bonds with a specific maturity, reducing portfolio rebalancing and associated costs, and gradually reducing sensitivity to interest rate risk.
However, their uptake has been limited, held back by a limited number of vintages and management fees that are often considered too high given the recent low bond yields.
Today, a new category of fund is emerging: term bond ETFs.
Leading asset managers such as BlackRock, Amundi, Xtrackers/DWS, Invesco and, most recently, BNP Paribas AM are positioning themselves in this segment, offering an innovative and accessible alternative to bond investing.
Why is this a good idea?
Term bond ETFs serve a dual purpose: to provide access to an asset class that has historically been less liquid than equities, while at the same time simplifying investment. These products offer transparency and predictable returns. Here are their main advantages:
- Simplified access to the bond asset class: Individual bonds are often complex to buy, with reduced liquidity and significant access costs. ETFs overcome these barriers by combining multiple securities into a single, easily tradable product.
- Controlled interest rate risk: Unlike traditional bond funds, maturity ETFs have a fixed maturity. This means that their duration decreases as they approach maturity, which limits their sensitivity to interest rates. What’s more, the fact that the ETF is held to maturity means that even in volatile market conditions, returns will be very close to those originally forecast (although there may be deviations in some cases). However, selling before maturity may result in a loss of capital.
- Choice of maturity: the maturity of the portfolio’s bond allocation can be controlled and it is possible to maintain an evolving maturity by rebalancing ETFs nearing maturity to ETFs with longer maturities.
- Ease of use: when account holders allow new securities to be listed, it is possible to invest very quickly.
- Choice of income type: In most cases, investors can choose between distribution ETFs (regular interest payments) and accumulation ETFs (automatic reinvestment of coupons).
Details of the current range
| Asset Manager | ETF Name | ETF Maturity | ETF ISIN |
|---|---|---|---|
| Blackrock | iShares iBonds Dec 2025 Term $ Treasury UCITS ETF | 2025 | IE000U99N3V1 |
| Blackrock | iShares iBonds Dec 2025 Term $ Corp UCITS ETF | 2025 | IE0000X2DXK3 |
| Blackrock | iShares iBonds Dec 2025 Term € Corp UCITS ETF | 2025 | IE000NXQKHU1 |
| Blackrock | iShares iBonds Dec 2025 Term € Corp UCITS ETF | 2025 | IE000GUOATN7 |
| Blackrock | iShares iBonds Dec 2026 Term € Italy Govt Bond UCITS ETF | 2026 | IE000G6CY1T7 |
| Blackrock | iShares iBonds Dec 2026 Term $ Corp UCITS ETF | 2026 | IE000BWITBP9 |
| Blackrock | iShares iBonds Dec 2026 Term $ Corp UCITS ETF | 2026 | IE0007UPSEA3 |
| Blackrock | iShares iBonds Dec 2026 Term € Corp UCITS ETF | 2026 | IE000SIZJ2B2 |
| Blackrock | iShares iBonds Dec 2026 Term € Corp UCITS ETF | 2026 | IE000WA6L436 |
| Blackrock | iShares iBonds Dec 2026 Term € Italy Govt Bond UCITS ETF | 2026 | IE000LZ7BZW8 |
| Blackrock | iShares iBonds Dec 2026 Term $ Corp UCITS ETF | 2026 | IE000KM34187 |
| Invesco | Invesco BulletShares 2026 EUR Corporate Bond UCITS ETF Acc | 2026 | IE0004QWOTD5 |
| Invesco | Invesco BulletShares 2026 EUR Corporate Bond UCITS ETF Dist | 2026 | IE000AYJ75E5 |
| Invesco | Invesco BulletShares 2026 USD Corporate Bond UCITS ETF Acc | 2026 | IE000ZUAJ6B7 |
| Invesco | Invesco BulletShares 2026 USD Corporate Bond UCITS ETF Dist | 2026 | IE000O36LOH8 |
| Invesco | Invesco BulletShares 2026 USD Corporate Bond UCITS ETF GBP Hdg Dist | 2026 | IE0001AXQAS6 |
| Amundi | Amundi Fixed Maturity 2027 German Bund Government Bond UCITS ETF Dist | 2027 | LU2780871823 |
| Amundi | Amundi Fixed Maturity 2027 Italy BTP Government Bond UCITS ETF Dist | 2027 | LU2780872128 |
| Blackrock | iShares iBonds Dec 2027 Term $ Treasury UCITS ETF | 2027 | IE0004OYBZA6 |
| Blackrock | iShares iBonds Dec 2027 Term € Corp UCITS ETF | 2027 | IE000ZOI8OK5 |
| Blackrock | iShares iBonds Dec 2027 Term € Corp UCITS ETF | 2027 | IE000H5X52W8 |
| Blackrock | iShares iBonds Dec 2027 Term $ Corp UCITS ETF | 2027 | IE000I1D7D10 |
| Blackrock | iShares iBonds Dec 2027 Term $ Treasury UCITS ETF | 2027 | IE0006UGU3X3 |
| Invesco | Invesco BulletShares 2027 EUR Corporate Bond UCITS ETF Acc | 2027 | IE000LGHLQ71 |
| Invesco | Invesco BulletShares 2027 EUR Corporate Bond UCITS ETF Dist | 2027 | IE000XOS4OJ6 |
| Invesco | Invesco BulletShares 2027 USD Corporate Bond UCITS ETF Acc | 2027 | IE0001XIQ4D9 |
| Invesco | Invesco BulletShares 2027 USD Corporate Bond UCITS ETF Dist | 2027 | IE000BMDG046 |
| Invesco | Invesco BulletShares 2027 USD Corporate Bond UCITS ETF GBP Hdg Dist | 2027 | IE00025DKLQ3 |
| Xtrackers | Xtrackers II Target Maturity Sept 2027 EUR Corporate Bond UCITS ETF 1C | 2027 | LU2673522830 |
| Xtrackers | Xtrackers II Target Maturity Sept 2027 EUR Corporate Bond UCITS ETF 1D | 2027 | LU2673523218 |
| Amundi | Amundi Fixed Maturity 2028 Euro Government Bond Broad UCITS ETF Dist | 2028 | LU2780871401 |
| Amundi | Amundi Fixed Maturity 2028 Euro Government Bond Yield + UCITS ETF Dist | 2028 | LU2780871666 |
| Blackrock | iShares iBonds Dec 2028 Term € Italy Govt Bond UCITS ETF | 2028 | IE000JHMFVN7 |
| Blackrock | iShares iBonds Dec 2028 Term € Corp UCITS ETF | 2028 | IE000264WWY0 |
| Blackrock | iShares iBonds Dec 2028 Term $ Corp UCITS ETF | 2028 | IE0000VITHT2 |
| Blackrock | iShares iBonds Dec 2028 Term $ Corp UCITS ETF | 2028 | IE0000UJ3480 |
| Blackrock | iShares iBonds Dec 2028 Term € Corp UCITS ETF | 2028 | IE0008UEVOE0 |
| Blackrock | iShares iBonds Dec 2028 Term € Italy Govt Bond UCITS ETF | 2028 | IE000Q2EQ5K8 |
| Invesco | Invesco BulletShares 2028 EUR Corporate Bond UCITS ETF Acc | 2028 | IE00079EUF59 |
| Invesco | Invesco BulletShares 2028 EUR Corporate Bond UCITS ETF Dist | 2028 | IE000LKGEZQ6 |
| Invesco | Invesco BulletShares 2028 USD Corporate Bond UCITS ETF Acc | 2028 | IE000GMRDSZ7 |
| Invesco | Invesco BulletShares 2028 USD Corporate Bond UCITS ETF Dist | 2028 | IE000A0RC215 |
| Invesco | Invesco BulletShares 2028 USD Corporate Bond UCITS ETF GBP Hdg Dist | 2028 | IE000QAO7DD4 |
| Xtrackers | Xtrackers II Target Maturity Sept 2028 EUR Corporate Bond UCITS ETF 1D | 2028 | LU2810185665 |
| Blackrock | iShares iBonds Dec 2029 Term $ Corp UCITS ETF | 2029 | IE000QJMYB29 |
| Blackrock | iShares iBonds Dec 2029 Term $ Treasury UCITS ETF | 2029 | IE00055OM853 |
| Blackrock | iShares iBonds Dec 2029 Term € Corp UCITS ETF | 2029 | IE000SNLFDR7 |
| Blackrock | iShares iBonds Dec 2029 Term $ Treasury UCITS ETF | 2029 | IE00076HZIP3 |
| Blackrock | iShares iBonds Dec 2029 Term $ Corp UCITS ETF | 2029 | IE000Y247W99 |
| Blackrock | iShares iBonds Dec 2029 Term € Corp UCITS ETF | 2029 | IE000IHURBR0 |
| Invesco | Invesco BulletShares 2029 EUR Corporate Bond UCITS ETF Acc | 2029 | IE000P5IB8I8 |
| Invesco | Invesco BulletShares 2029 EUR Corporate Bond UCITS ETF Dist | 2029 | IE000ZC4C5Q1 |
| Invesco | Invesco BulletShares 2029 USD Corporate Bond UCITS ETF Acc | 2029 | IE000B4EDHL6 |
| Invesco | Invesco BulletShares 2029 USD Corporate Bond UCITS ETF Dist | 2029 | IE000C5Q64P6 |
| Invesco | Invesco BulletShares 2029 USD Corporate Bond UCITS ETF GBP Hdg Dist | 2029 | IE000GFG8GS0 |
| Xtrackers | Xtrackers II Target Maturity Sept 2029 EUR Corporate Bond UCITS ETF 1C | 2029 | LU2673522913 |
| Xtrackers | Xtrackers II Target Maturity Sept 2029 EUR Corporate Bond UCITS ETF 1D | 2029 | LU2673523309 |
| Blackrock | iShares iBonds Dec 2030 Term $ Corp UCITS ETF | 2030 | IE0008TDJ461 |
| Blackrock | iShares iBonds Dec 2030 Term € Corp UCITS ETF | 2030 | IE000Y2BJVK9 |
| Blackrock | iShares iBonds Dec 2030 Term $ Corp UCITS ETF | 2030 | IE000WZJ38F1 |
| Blackrock | iShares iBonds Dec 2030 Term $ Corp UCITS ETF | 2030 | IE000BZXJJ24 |
| Blackrock | iShares iBonds Dec 2030 Term € Corp UCITS ETF | 2030 | IE000LX17BP9 |
| Invesco | Invesco BulletShares 2030 EUR Corporate Bond UCITS ETF Acc | 2030 | IE000I25S1V5 |
| Invesco | Invesco BulletShares 2030 EUR Corporate Bond UCITS ETF Dist | 2030 | IE000W6YTDH7 |
| Invesco | Invesco BulletShares 2030 USD Corporate Bond UCITS ETF Acc | 2030 | IE00034XRBU1 |
| Invesco | Invesco BulletShares 2030 USD Corporate Bond UCITS ETF Dist | 2030 | IE000GB2EQ90 |
| Invesco | Invesco BulletShares 2030 USD Corporate Bond UCITS ETF GBP Hdg Dist | 2030 | IE000Y0DQX41 |
| Xtrackers | Xtrackers II Target Maturity Sept 2030 EUR Corporate Bond UCITS ETF 1D | 2030 | LU2809864296 |
| Blackrock | iShares iBonds Dec 2031 Term € Corp UCITS ETF | 2031 | IE000D9WMGF0 |
| Blackrock | iShares iBonds Dec 2031 Term € Corp UCITS ETF | 2031 | IE000I2WYEU9 |
| Blackrock | iShares iBonds Dec 2031 Term $ Corp UCITS ETF | 2031 | IE00019EG7X4 |
| Blackrock | iShares iBonds Dec 2031 Term $ Corp UCITS ETF | 2031 | IE0009EQZP90 |
| Xtrackers | Xtrackers II Target Maturity Sept 2031 EUR Corporate Bond UCITS ETF 1C | 2031 | LU2673523135 |
| Xtrackers | Xtrackers II Target Maturity Sept 2031 EUR Corporate Bond UCITS ETF 1D | 2031 | LU2673523481 |
| Blackrock | iShares iBonds Dec 2032 Term € Corp UCITS ETF | 2032 | IE0000MR4GH9 |
| Blackrock | iShares iBonds Dec 2032 Term € Corp UCITS ETF | 2032 | IE000I660ZF8 |
| Blackrock | iShares iBonds Dec 2032 Term $ Corp UCITS ETF | 2032 | IE00049LEBV0 |
| Blackrock | iShares iBonds Dec 2032 Term $ Corp UCITS ETF | 2032 | IE0007YBWBE5 |
| Blackrock | iShares iBonds Dec 2032 Term $ Corp UCITS ETF | 2032 | IE000C2BA1B7 |
| Xtrackers | Xtrackers II Target Maturity Sept 2032 EUR Corporate Bond UCITS ETF 1D | 2032 | LU2809864452 |
| Blackrock | iShares iBonds Dec 2033 Term € Corp UCITS ETF | 2033 | IE000E0NL9T3 |
| Blackrock | iShares iBonds Dec 2033 Term $ Corp UCITS ETF | 2033 | IE000LETV955 |
| Blackrock | iShares iBonds Dec 2033 Term $ Corp UCITS ETF | 2033 | IE000K44CW70 |
| Blackrock | iShares iBonds Dec 2033 Term € Corp UCITS ETF | 2033 | IE000ZBGZQM8 |
| Xtrackers | Xtrackers II Target Maturity Sept 2033 EUR Corporate Bond UCITS ETF 1C | 2033 | LU2673523051 |
| Xtrackers | Xtrackers II Target Maturity Sept 2033 EUR Corporate Bond UCITS ETF 1D | 2033 | LU2673523564 |
| Blackrock | iShares iBonds Dec 2034 Term € Corp UCITS ETF | 2034 | IE000SBJO6L2 |
| Blackrock | iShares iBonds Dec 2034 Term € Corp UCITS ETF | 2034 | IE000UY6XF65 |
| Blackrock | iShares iBonds Dec 2034 Term $ Corp UCITS ETF | 2034 | IE000RC18FG8 |
| Blackrock | iShares iBonds Dec 2034 Term $ Corp UCITS ETF | 2034 | IE000VVBM1F6 |
| Xtrackers | Xtrackers II Target Maturity Sept 2034 EUR Corporate Bond UCITS ETF 1D | 2034 | LU2809864619 |
The bottom line
Maturity bond ETFs represent a major step forward in the way investors can access this asset class. By simplifying access, providing greater visibility of returns and reducing interest rate risk, these products have the potential to transform traditional asset allocation. As the European market continues to develop, fixed income ETFs are likely to become an essential tool for both institutional and retail investors.