IShares Core £ Corp Bond ETF (SLXX) Bid Offer Spread

Just been looking at my fixed interest portfolio this evening which has lots of retail bonds, the M&G Corporate Bond fund and SLXX. I could see that year to date the M&G fund was down about 2% but SLXX was showing a 7% decline which got me interested. It seems the latest net asset value (11 March) was £152.35 but the bid at close on 12 March was £139.4 and offer £148.95 which accounts for most of the 7% fall. I don't intend to sell, but is this common that ETFs can go to such wide spreads in a crash? It is one of ishares core funds with net assets of£1.8 billion so I had hoped there was plenty of liquidity available. Will be interested to monitor the price tomorrow . . .

Comments

  • Of course, and don't be afraid to buy more if you have spare cash, put in a bid at 140 and you might get a lucky fill from some toilet paper junkie, haha
  • Nice idea, I was wondering if there was an opportunity here. We now know the NAV last night was £149.2 and today the bid offer is £142 to £144 so I'm being offered a 4% discount without putting in a cheeky bid. Unfortunately as the index follows the largest and most liquid corporate bonds, these are the ones institutions will get rid of first so who knows where it could end up. What looked like an easy way to track a bond index is getting a lot more complex.
  • Bond Indices are harder to track because of all the regular maturing securities, though they are very easy to outperform by active managers, counterintuitive to what we see in equity benchmarks vs active equity managers, i haven't quite figured out this one yet

    Yes, in the broad based sell-off, you'll see all sorts of things sell-off, even gold counterintuitively, but not so counterintuitive given you have to sell something for your cash needs if you didn't have any spare left

    Don't be afraid to buy if you have spare cash, this is the most brutal move since lehman, three weeks following that we had 33% drawdown and now we have almost matched it, and the corona virus problem is nowhere near as bad as great financial crisis, but of course there is a counter argument -

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