PT - JOURNAL ARTICLE AU - Patrick Houweling TI - On the Performance of Fixed-Income Exchange-Traded <br/>Funds AID - 10.3905/jii.2012.3.1.039 DP - 2012 May 31 TA - The Journal of Index Investing PG - 39--44 VI - 3 IP - 1 4099 - https://pm-research.com/content/3/1/39.short 4100 - https://pm-research.com/content/3/1/39.full AB - The authors evaluate the performance of fixed-income exchange-traded funds (ETFs). They find that Treasury ETFs are indeed able to track their benchmarks but that investmentgrade corporate bond ETFs underperform their benchmarks and high-yield corporate bond ETFs severely underperform their benchmarks. They provide evidence that the transaction costs of the underlying bonds are a key determinant of an ETF’s underperformance. The authors conclude that indices consisting of bonds that are more costly to trade are more difficult to track.TOPICS: Exchange-traded funds and applications, mutual fund performance, portfolio construction