Invesco Ltd. today expanded its roster of BulletShares defined-maturity exchange-traded funds with the launch of nine municipal bond products with fixed-date maturity years ranging from 2021 through 2029.

Defined-maturity bond funds provide a cost-efficient way to create a bond laddering strategy. Traditional laddering consists of a portfolio of individual bonds with staggered maturities that aim to generate predictable income and hedge against interest rate risk. This can be an expensive and complex proposition for financial advisors and individual investors.

A simpler way to achieve this is via defined-maturity bond funds containing a portfolio of bonds that mature or are anticipated to be called in a specific year. They aim to provide consistent interest payments before distributing a final payout in a fund’s target year.

The nine new Invesco ETFs comprise the following:

Invesco BulletShares 2021 Municipal Bond ETF (BSML)

Invesco BulletShares 2022 Municipal Bond ETF (BSMM)

Invesco BulletShares 2023 Municipal Bond ETF (BSMN)

Invesco BulletShares 2024 Municipal Bond ETF (BSMO)

Invesco BulletShares 2025 Municipal Bond ETF (BSMP)

Invesco BulletShares 2026 Municipal Bond ETF (BSMQ)

Invesco BulletShares 2027 Municipal Bond ETF (BSMR)

Invesco BulletShares 2028 Municipal Bond ETF (BSMS)

Invesco BulletShares 2029 Municipal Bond ETF (BSMT)

All nine funds have a net expense ratio of 0.18%.

According to the prospectus, each fund in this suite is market-value weighted and holdings are capped at 5% at each monthly rebalance. During a particular fund’s stated maturity year, bonds within its portfolio that mature or are called will be invested in variable rate demand obligations, which are liquid, floating rate municipal securities.

The entire BulletShares suite of defined-maturity ETFs consists of 33 products covering municipal bonds, investment-grade corporate bonds, high-yield corporate bonds and emerging-market debt.

The BulletShares suite’s largest competitor in the defined-maturity ETF space is the roster of 25 iBond ETFs from BlackRock’s iShares unit comprising investment-grade, high-yield and municipal funds. The nine municipal products have stated maturity years ranging from 2020 through 2028, and all charge a net expense ratio of 0.18%. And all currently have SEC yields below 2%.