RLB offers exposure to a diversified portfolio of Canadian investment-grade corporate and government bonds, with maturity dates staggered ("laddered") from one to five years.
The portfolio is divided into five equally weighted (20%) segments, with maturities ranging from one to five years. 70% of the portfolio is allocated to Canadian investment-grade corporate bonds through RBC Target Maturity Bond ETFs and 30% is directly invested in Canadian government bonds.
To maintain the maturity profile, at the end of each year, the portfolio managers sell those bonds that mature within one year and replace them with new bonds that mature in five years. For example, in December 2018, they will sell RQG and the government bonds maturing in 2019. They will then purchase new bonds with a targeted maturity date of 2024. Each quarter, the portfolio managers rebalance the portfolio to ensure a 20% allocation to each maturity year.
RLB pays out all its net income on a monthly basis. The amount of the payout depends on the income stream received from the underlying bonds, and may vary from month to month. Distributions are expected to be mostly interest income
RBC Global Asset Management Inc. is Canada's largest fund company by assets under management (IFIC, as of August 31, 2017).
FTSE TMX Maturity Canada Corporate Bond Indices™ are trademarks of TSX Inc., a subsidiary of TMX Group Inc., and have been licensed for use for certain purposes to RBC Global Asset Management Inc. by FTSE TMX Global Debt Capital Markets Inc. The RBC ETFs are not sponsored, endorsed, sold or promoted by FTSE TMX Global Debt Capital Markets Inc., FTSE International Limited, TMX Group Inc. or their affiliates, or third party data suppliers and they make no representation, warranty or condition regarding the advisability of investing in the RBC ETFs.
