Average Daily Volume
2.08M
Fund Overview
The iShares Floating Rate Bond ETF (FLOT) seeks to track the investment results of the Bloomberg U.S. Floating Rate Note < 5 Years Index. This index measures the performance of U.S. dollar-denominated, investment-grade floating rate notes with maturities of less than five years. FLOT provides investors with exposure to short-term, investment-grade corporate bonds whose interest payments adjust periodically based on changes in benchmark rates, such as LIBOR or SOFR. This structure helps mitigate interest rate risk compared to fixed-rate bonds. The fund is designed for investors seeking income with lower sensitivity to rising interest rates.
- Asset Class
-
Bond
- Industry
-
Corporate Bonds
- Annual Dividend Rate
-
- Smart Beta
-
No
- Leveraged / Inverse
-
N/A / No
- Dividend Quality - Yield
-
- 4.74 %
- Currency Hedged
-
No
- Portfolio Turnover
-
37 %
- Dividend Date
-
Why Invest in the FLOT ETF?
Potential Benefits
- Lower interest rate risk due to floating rate coupons that adjust with market rates.
- Exposure to investment-grade corporate bonds, offering relatively lower credit risk.
- Short duration profile reduces sensitivity to rising interest rates compared to fixed-rate bonds.
- Provides a potential hedge against inflation as coupon payments adjust with benchmark rates.
- Liquidity benefits from holding short-term securities in a diversified portfolio.
Potential Risks
- Credit risk remains a concern if underlying issuers face financial distress.
- Lower yield potential compared to longer-duration or lower-quality bonds.
- Floating rate notes may underperform in declining rate environments.
- Market liquidity risk during periods of financial stress.
- Exposure to financial sector issuers, which dominate the floating rate note market.
RSI data unavailable or insufficient history.
Monthly Returns (%)
| Year |
Jan |
Feb |
Mar |
Apr |
May |
Jun |
Jul |
Aug |
Sep |
Oct |
Nov |
Dec |
| 2026 |
+0.4%
|
+0.3%
|
+0.2%
|
+0.5%
|
+0.3%
|
+0.4%
|
+0.4%
|
+0.3%
|
+0.4%
|
+0.1%
|
-
|
-
|
| 2025 |
+0.4%
|
+0.4%
|
+0.3%
|
+0.2%
|
+0.5%
|
+0.5%
|
+0.4%
|
+0.4%
|
+0.5%
|
+0.4%
|
+0.4%
|
+0.4%
|
| 2024 |
+0.6%
|
+0.7%
|
+0.5%
|
+0.6%
|
+0.6%
|
+0.4%
|
+0.5%
|
+0.4%
|
+0.5%
|
+0.5%
|
+0.6%
|
+0.5%
|
| 2023 |
+0.7%
|
+0.7%
|
-0.4%
|
+0.9%
|
+0.7%
|
+0.7%
|
+0.5%
|
+0.5%
|
+0.5%
|
+0.5%
|
+0.4%
|
+0.5%
|
| 2022 |
-0.1%
|
0.0%
|
-0.3%
|
0.0%
|
-0.2%
|
-0.8%
|
+0.7%
|
+0.4%
|
+0.1%
|
+0.2%
|
+0.7%
|
+0.6%
|
| 2021 |
+0.2%
|
+0.1%
|
-0.1%
|
0.0%
|
+0.1%
|
+0.1%
|
0.0%
|
0.0%
|
+0.1%
|
-0.1%
|
-0.1%
|
+0.1%
|
| 2020 |
+0.3%
|
-0.1%
|
-4.2%
|
+2.8%
|
+0.7%
|
+0.8%
|
+0.2%
|
+0.1%
|
+0.1%
|
0.0%
|
+0.2%
|
0.0%
|
| 2019 |
+0.8%
|
+0.4%
|
+0.3%
|
+0.4%
|
+0.2%
|
+0.2%
|
+0.3%
|
+0.2%
|
+0.3%
|
+0.3%
|
+0.2%
|
+0.2%
|
| 2018 |
+0.4%
|
+0.1%
|
0.0%
|
+0.4%
|
+0.2%
|
+0.1%
|
+0.2%
|
+0.3%
|
+0.1%
|
+0.1%
|
-0.3%
|
-0.2%
|
| 2017 |
+0.1%
|
+0.2%
|
+0.2%
|
+0.1%
|
+0.2%
|
+0.2%
|
+0.2%
|
0.0%
|
+0.2%
|
+0.2%
|
+0.2%
|
0.0%
|
< -5%
-5% to -2%
-2% to 0%
0%
0% to +2%
+2% to +5%
> +5%
Top Holdings (by weight)
| Symbol |
Company Name |
Weight |
No holdings data available.
Related ETFs: FLOT vs Peers
Comparison highlights key differences on cost, coverage, and focus within sector ETFs.
Investment Strategy
FLOT tracks the Bloomberg U.S. Floating Rate Note < 5 Years Index, which includes U.S. dollar-denominated, investment-grade floating rate notes with remaining maturities under five years. The index is market value-weighted and rebalances monthly. The fund primarily holds corporate FRNs that reset their coupons quarterly based on reference rates. FLOT employs representative sampling to track its index rather than full replication, holding a diversified basket of securities that collectively mirror the index's risk and return characteristics. The portfolio maintains an average effective duration under one year.
Frequently Asked Questions
What benchmark rate does FLOT use for its floating rate notes?
FLOT's holdings typically use benchmark rates like SOFR (Secured Overnight Financing Rate) or its predecessor LIBOR (phasing out), with coupons resetting quarterly based on these reference rates plus a spread.
How often does FLOT pay dividends?
FLOT distributes income to shareholders monthly, reflecting the periodic coupon payments from its underlying floating rate notes.
Is FLOT a good investment when interest rates are rising?
Yes, FLOT's floating rate structure makes it particularly suitable for rising rate environments as its coupon payments adjust upward with benchmark rates, unlike fixed-rate bonds that lose value when rates rise.
What percentage of FLOT's holdings are financial sector bonds?
As of recent data, approximately 60-70% of FLOT's portfolio consists of financial sector floating rate notes, with the remainder spread across utilities, industrials, and other sectors.
How does FLOT's credit quality compare to other bond ETFs?
FLOT maintains investment-grade credit quality, with the majority of its holdings rated BBB or higher. This makes it higher quality than high-yield bond ETFs but slightly lower than Treasury-focused floating rate ETFs.
Industry Overview
The iShares Floating Rate Bond ETF (FLOT) operates in the short-term, investment-grade corporate bond market. Floating rate notes (FRNs) have gained popularity as investors seek to reduce interest rate risk in rising rate environments. Unlike traditional fixed-rate bonds, FRNs feature coupons that reset periodically based on benchmark rates like SOFR, making them less sensitive to rate hikes. The financial sector dominates FRN issuance, but utilities, industrials, and other sectors also contribute. FLOT provides a convenient way to access this niche while maintaining credit quality and liquidity.
Alternative Comparison
Compared to similar floating rate ETFs like TFLO (iShares Treasury Floating Rate Bond ETF) and USFR (WisdomTree Floating Rate Treasury Fund), FLOT takes on slightly more credit risk by focusing on corporate issuers rather than U.S. Treasury floating rate notes. However, this corporate exposure typically offers higher yields. Among corporate floating rate ETFs, FLOT distinguishes itself with a competitive 0.15% expense ratio and pure exposure to investment-grade credits, unlike some peers that include high-yield components. FLOT's portfolio also tends to be more liquid than actively managed floating rate funds.
Issuer Overview
iShares, a division of BlackRock, is the world's largest ETF provider with over $3 trillion in global ETF assets under management. Known for its extensive lineup of index-tracking ETFs, iShares combines BlackRock's investment expertise with efficient portfolio management. The firm's scale allows for tight tracking of benchmarks and competitive expense ratios across its product range, including fixed income offerings like FLOT.
Conclusion
FLOT offers investors an efficient way to gain exposure to investment-grade floating rate corporate bonds while minimizing interest rate risk. Its short duration profile and coupon reset mechanism make it particularly attractive during periods of rising rates. While the fund carries some credit risk, its focus on quality issuers and BlackRock's indexing expertise make it a core holding for investors seeking income with reduced rate sensitivity. As with all fixed income investments, FLOT should be considered as part of a diversified portfolio strategy.
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