What is the Bloomberg Barclays US Aggregate Bond Index?

Introduction

The Bloomberg Barclays US Aggregate Bond Index is the most widely followed U.S. bond market index. It measures the investment grade, US dollar-denominated, fixed-rate taxable bond market. The Index includes Treasuries, government-related and corporate securities, MBS (agency fixed-rate and hybrid ARM pass-throughs), ABS and CMBS (agency and nonagency). It includes securities that have at least one year to maturity, and have an outstanding par value of at least $250 million. Bonds specifically excluded are tax-exempt municipal securities, inflation-linked bonds, floating-rate issues and convertible bonds. The index is market cap weighted and reconstituted on the last business day of the month.

The Bloomberg Barclays US Aggregate Bond Index only includes bonds that are currently rated "investment grade" by one of the three companies that give ratings to most U.S. bonds (Standard & Poor's, Moody's and Fitch). As shown in our article about bond ratings, these rating agencies actually give each bond a rating that is on a sliding scale using a system that has about 20 different possible ratings. But the bond industry and the investment community has generally agreed upon a consensus that any bond that gets a rating above a certain point is considered an "investment grade" bond, and any bond that gets a rating below a certain point is considered to be a "high yield bond". Virtually all discussions about the bond market hinge around "investment grade" versus "high yield" bonds.

The Bloomberg Barclays US Aggregate Bond Index includes investment grade bonds issued in U.S. dollars, even if they are issued by a foreign government or foreign corporation. Because the U.S. stock market is the largest in the world, many governments and corporations from around the world issue bonds in U.S. dollars. Therefore, on StockMarketMBA.com, when we categorize investment funds, we use the category "US Fixed Income" when the fund only invests in bonds denominated in the U.S. dollar, even if the fund invests in bonds issued by foreign governments or corporations. Similarly, a fund labeled "Global Fixed Income" is a fund that is willing to invest in bonds denominated in currencies other than the U.S. dollar.

The Bloomberg Barclays US Aggregate Bond Index is reconstituted monthly and typically includes around 10,000 bonds. Here is the approximate weight of each bond class in the index:

ETFs that track

Exchange traded funds ("ETFs") make it very easy to invest in bonds. There are a few large ETFs that track the Bloomberg Barclays U.S. Aggregate Bond Index:

SymbolDescriptionLeverage FactorMarket capCurrent YieldAction
AGGiShares Core U.S. Aggregate Bond ETF1.00$78,946,279,0002.33%Analyze
BKAGBNY Mellon Core Bond ETF1.00$30,385,0130.63%Analyze
SCHZSchwab U.S. Aggregate Bond ETF1.00$8,207,668,0002.51%Analyze
SPABSPDR Portfolio Aggregate Bond ETF1.00$5,422,568,1342.57%Analyze

What is not included in the index?

Let's look at the types of bonds that are not included in the Bloomberg Barclays US Aggregate Bond Index. We have included here links to some of the largest ETFs that buy those types of bonds if you want to explore further.

Inflation Protected U.S. Treasuries

The U.S. government issues U.S. treasuries that are inflation protected. Every year, the "principal" amount is adjusted for inflation, thus adjusting the amount of the interest payment.

SymbolDescriptionCurrent yieldFees Action
SPIPSPDR Portfolio TIPS ETF1.64%0.12%Analyze
SCHPSchwab U.S. TIPS ETF1.02%0.05%Analyze
STIPiShares Barclays 0-5 Year TIPS ETF0.98%0.06%Analyze
TIPiShares TIPS Bond Fund ETF0.81%0.20%Analyze
VTIPVanguard Short-Term Inflation-Protected Securities ETF0.69%0.06%Analyze

Investment Grade Municipal Bonds

Most but not all municipal bonds are exempt from Federal income tax and are rated investment grade.

SymbolDescriptionCurrent yieldFees Action
PZAInvesco National AMT-Free Municipal Bond ETF2.57%0.28%Analyze
ITMMarket Vectors Intermediate Municipal ETF2.21%0.24%Analyze
MUBiShares National Muni Bond ETF2.23%0.07%Analyze
TFISPDR Nuveen Bloomberg Barclays Municipal Bond ETF2.00%0.23%Analyze
SHMSPDR Nuveen Bloomberg Barclays Short Term Municipal Bond ETF1.52%0.20%Analyze
SUBiShares Short-Term National Muni Bond ETF1.41%0.07%Analyze

High Yield Municipal Bonds

It sounds weird, but there are municipal bonds issued that are considered high yield bonds.

SymbolDescriptionCurrent yieldFees Action
HYDMarket Vectors High Yield Municipal Index ETF4.22%0.35%Analyze
HYMBSPDR Nuveen S&P High Yield Municipal Bond ETF3.78%0.35%Analyze

High Yield Corporate Bonds

High yield corporate bonds are very popular with investors.

SymbolDescriptionCurrent yieldFees Action
SJNKBarclays Short Term High Yield Bond ETF5.71%0.40%Analyze
JNKSPDR Barclays High Yield Bond ETF5.57%0.40%Analyze
USHYiShares Broad USD High Yield Corporate Bond ETF5.75%0.22%Analyze
SHYGiShares 0-5 Year High Yield Corporate Bond ETF5.41%0.30%Analyze
HYGiShares iBoxx High Yield Corporate Bond ETF5.08%0.49%Analyze
HYSPIMCO 0-5 Year High Yield Corporate Bond Index Fund ETF4.87%0.56%Analyze

Fallen Angel Corporate Bonds

A fallen angel is a bond that at the time of issuance was rated investment grade but has since been downgraded to high yield status.

SymbolDescriptionCurrent yieldFees Action
FALNiShares Fallen Angels USD Bond ETF5.43%0.25%Analyze
ANGLMarket Vectors Fallen Angel High Yield Bond ETF5.14%0.35%Analyze

Leveraged Bank Loans

Leveraged bank loans are large loans to a corporation that are "syndicated" -- i.e. the loan is so big that pieces of the loan are "sold" to other banks and investors by the lead bank coordinating the deal. They are usually variable rate loans. See our article what is a bank loan?

SymbolDescriptionCurrent yieldFees Action
SRLNSPDR Blackstone/GSO Senior Loan ETF5.10%0.70%Analyze
BKLNInvesco Senior Loan Portfolio ETF4.01%0.65%Analyze
FTSLFirst Trust Senior Loan ETF3.78%0.88%Analyze


All data is a live query from our database. The wording was last updated: 04/22/2020.

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