Rieger Report®: Re-Ranking the Global Green Bond ETFs

October 1st, 2019: Global Green Bond ETF Rankings

Re-ranking the two U.S. green bond ETFs following VanEck’s index change to track only USD green bonds and it’s change in management fees down to 20bps from 30bps in September 2019. This results in a higher yield without currency risk and a more attractive ETF as a result.

The Rieger Report® ranks them as follows:

VanEck Vectors Green Bond ETF (GRNB): Rationale: Higher yields (both 30 Day SEC Yield and Yield to Maturity) and shorter duration than competitor’s ETF. VanEck brought it’s management fee in line with iShares BRGN (September 2019).

iShares Global Green Bond ETF (BRGN): Rationale: Due to the global nature of green bonds and the resulting non-USD issuance the currency risk mitigation taken by iShares is a value proposition as long as hedging is cost efficient. However, the resulting lower yield and longer duration makes this ETF unattractive at this time in my opinion.

October 2019 Green Bond ETF Rankings

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Sources: iShares by BlackRock, VanEck. Table is shown for illustrative purposes only. Past performance is not indicative of future results. Data as of 9/30/2019 unless otherwise noted. (1) SEC Yield for BGRN is as of 9/27/2019.

2019 Analyst Disclosure

  • JR Rieger and or the Rieger Report LLC has not received compensation either directly or indirectly from the sponsor(s) of the ETF(s) included in this report.
  • At the time of this writing, JR Rieger does not own the ETF(s) cited in this report.

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