3 ASX exchange-traded funds slumping to 52-week lows today

These exchange-traded funds have seen better days than today…

| More on:
ETF written in red across three piggybanks.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • Not too many ASX ETFs are close to their 52-week lows today 
  • But these three exchange-traded funds just hit new lows 
  • Let's see what they have in common 

Today has not been a good day for the S&P/ASX 200 Index (ASX: XJO). At the time of writing, the ASX 200 has lost 0.79% and is back under 7,500 points. But the trading day has been a lot worse for a few ASX exchange-traded funds (ETFs) out there.

At least three ASX ETFs have reached new 52-week lows just today. So let's check them out and see what they might have in common.

3 ASX exchange-traded funds hitting 52-week lows today

The first ASX exchange-traded fund hitting a new 52-week low today is the Vanguard Australian Fixed Interest Index ETF (ASX: VAF). This fund from popular provider Vanguard touched a low of $45.62 a unit today, which is getting quite far from its 52-week high of $51.44. VAF is a bond fund. It primarily holds investment-grade Australian government bonds, issued by both the federal and state governments, but also has some other fixed interest investments from corporations and local governments thrown in. 

Another ETF to check out is the iShares Core Composite Bond ETF (ASX: IAF). This exchange-traded fund is very similar to VAF in nature. It also holds mostly Australian government bonds, with a similar mix of state, local and corporate bonds thrown in. IAF units have also hit a new 52-week low today. This ETF's units hit $103.15 each this morning, again a ways away from this fund's 52-week high of $115.31.  

Finally, we have the BetaShares Australian Investment Grade Corporate Bond ETF (ASX: CRED). This fund is a little different to the above two, in that it only invests in corporate bonds rather than government bonds. This is designed to increase the yield available to investors, albeit without that 'risk-free' tag that comes with a Treasury. But unfortunately for investors, CRED is our third ASX exchange-traded fund to hit a 52-week low today. This ETF touched $23.18 a unit earlier today, putting even more distance between its 52-week high of $27.61. 

Why are bond ETFs being sold off?

So you might have noticed that these three exchange-traded funds are all fixed-interest or bond ETFs. This is not a coincidence then, it seems. Bonds typically rise in value when interest rates go down. That's because their already-set yield becomes more attractive than newer bonds. But the opposite is also true when interest rates rise, and this looks to be occurring today. 

Fresh from the all-time low interest rates we have seen around the world, the US Federal Reserve raised its rate for the first time in years last month. Just yesterday, our own Reserve Bank of Australia (RBA) signalled that rates might be rising here sooner than it initially flagged. 

Thus, it might come as no surprise that bond and fixed-interest ASX exchange-traded funds are currently being sold off. 

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on ETFs

Businessman working on street in New York. Dressing in blue suit, a young guy with beard, sitting outside office building, looking down, reading, typing on laptop computer.
ETFs

5 reasons to buy the iShares S&P 500 IVV ETF

There's a reason this fund is a popular option for Aussie investors.

Read more »

Australian dollar notes in the pocket of a man's jeans, symbolising dividends.
Dividend Investing

Big dividends: A 7% ASX ETF to buy for income this week

This ETF is a great choice when you can't find anything else...

Read more »

A young well-dressed couple at a luxury resort celebrate successful life choices.
ETFs

Buy and hold NDQ and these ASX ETFs for 10 years

These funds could be top picks for investors wanting to grow their wealth over the long term.

Read more »

ETF written in white with a blackish background.
ETFs

2 excellent ASX ETFs I think have great potential to beat the ASX 200

These funds have delivered big returns and I think they’re set up to deliver more.

Read more »

A hand chalks the word Top 5.
ETFs

5 of the best ASX ETFs to buy in July

Not a fan of stock picking? Then take a look at these funds.

Read more »

Different Australian notes.
ETFs

Own the Vanguard US Total Market Shares Index ETF? Here's your next dividend

Vanguard announced the final distribution amount for VTS ETF investors today.

Read more »

ETF written on cubes sitting on piles of coins.
ETFs

Own SPDR ASX ETFs? Here is your next dividend and when you'll receive it

State Street Global Advisors announced distribution payment amounts and dates today.

Read more »

Happy young couple saving money in piggy bank.
ETFs

Top ASX ETFs for passive income in FY26

Here are a few options for income investors to consider.

Read more »