QLTA vs SPBO

QLTAAiShares Aaa - A Rated Corporate Bond ETF

SPBOAState Street SPDR Portfolio Corporate Bond ETF

In short

QLTA "Investment grade" spans a lot of ground, and its bottom rung sits one downgrade from junk. QLTA cuts that rung out and holds only Aaa through A corporate bonds: the credit-quality purist of the corporate bond aisle, running since 2012.

SPBO The whole investment-grade corporate bond market in one ticker for three basis points. Most rivals sell you a maturity slice; SPBO owns the lot, and it undercuts other funds tracking the very same Bloomberg index.

Stated mandate

QLTA The fund seeks to track an index of U.S.-dollar investment-grade corporate bonds rated Aaa through A.

SPBO The fund seeks investment results that generally correspond, before fees and expenses, to the price and yield performance of the Bloomberg U.S. Corporate Bond Index.

Why people hold it

• QLTA The whole design in one line: only Aaa through A rated corporate bonds, so the BBB tier that sits a single notch above junk never enters the portfolio.ishares.com
• Charges 0.15% a year, below the typical fee among investment-grade corporate bond ETFs.
• Spreads across thousands of bonds from US and non-US corporations, and pays income monthly.ishares.com
• Has hugged its benchmark, the Bloomberg U.S. Corporate Aaa - A Capped Index, closely since launching in 2012, one of the tighter implementations in its peer group.

• SPBO 0.03% a year against a category median of 0.19%. In bond land, where the yield does the heavy lifting, that fee gap is not a rounding error.
• Thousands of corporate bonds across the full maturity range, so you hold the broad IG corporate market instead of one duration bucket.ssga.com
• Same index, very different tolls: KORP charges 0.29%, JLQD 0.35%, JHCB 0.53%. SPBO sits at the cheap end of that list.
• Running since 2011, pays monthly, and tracks its benchmark about as closely as anything in the investment-grade corporate group.

Worth knowing

• QLTA The quality filter has a price. Broad investment-grade rivals such as USIG and VCIT own the full ladder, BBB included, for a fraction of this fee.
• High ratings are credit protection, not rate protection. This is still a corporate bond fund, and its share price moves when interest rates move.ishares.com
• A multi-billion-dollar fund, but a moderately traded one rather than a household-name corporate bond ETF, so spreads can widen when markets get busy.

• SPBO Full maturity range means long-dated paper is in the mix, so the price moves more when rates move than short-maturity peers like IGSB or SPIB.
• Corporate credit only. No Treasuries or mortgages to lean on, so the fund rides the health of corporate borrowers as well as the rate cycle.ssga.com
• Investment grade by design, US issuers only. No high-yield or emerging-market bonds in the basket.

Full QLTA profile⁠

Full SPBO profile⁠