Key Highlights

  • The fund holds Investment grade Corporate Bond exposure through an Interest Rate hedge.
  • Most of the portfolio is held through a single iShares investment grade corporate bond ETF.
  • Net asset value is $91.93, after a one-day gain of $0.19, or 0.21%.
  • The net expense ratio is 0.24%, and distributions are paid monthly.

Corporate bond investors who want Credit exposure while reducing sensitivity to rising interest rates have a structured option in the iShares Interest Rate Hedged Corporate Bond ETF (NYSEARCA:LQDH). Figures in this article are current to November 9, 2026. The fund seeks to track an index that includes investment grade corporate bonds with a hedge against rising interest rates. Shares trade on NYSE Arca and have been listed since May 2014.

Fund Fact

Detail

Exchange and ticker

NYSE Arca: LQDH

Fund inception

May 27, 2014

Net assets

$574.6 million

Net asset value

$91.93

Daily NAV change

+$0.19 (+0.21%)

Expense ratio (gross / net)

0.44% / 0.24%

30-day SEC yield

5.04%

Distribution frequency

Monthly

Number of holdings

1 (underlying fund plus swaps)

How the Hedge Is Built

The fund's main holding is an iShares investment grade corporate bond ETF, which accounts for about 97% of market value. Interest rate swaps, mostly referencing overnight index rates with maturities ranging from 2027 to 2050, make up the hedge.

Because the swaps offset rate movements, the fund's effective duration is only 0.04 years, far shorter than the underlying bonds. The option-adjusted spread of 94.6 basis points reflects the credit component of the portfolio.

Income and Yield Profile

The 30-day SEC yield of 5.04% and the 12-month trailing yield of 5.85% describe the income the fund has generated. Monthly distributions have been relatively steady, with recent payments in the range of roughly $0.42 to $0.49 per share.

Yields in a hedged structure can differ from unhedged corporate bond yields because the swaps change how rate movements flow through to the portfolio.

Costs, Derivatives and Risks

The gross expense ratio is 0.44%, and a fee Waiver reduces the net figure to 0.24%. The 30-day median bid-ask spread of 0.09% reflects moderate trading costs.

The fund's use of derivatives introduces counterparty risk, and hedging may not work as intended. Credit risk on the underlying corporate bonds remains, and the fund's returns depend on the performance of its swaps as well as its bond holdings.

Final Word

The iShares Interest Rate Hedged Corporate Bond ETF offers investment grade corporate credit exposure with much of the interest rate sensitivity removed through swaps. Its near-zero effective duration, monthly income and derivative structure define its profile. Investors will weigh this hedged approach against their interest rate outlook and tolerance for swap-related risk.