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WisdomTree Interest Rate Hedged U.S. Aggregate Bond Fund gains focus amid yield swings
AGZD, which tracks a rate-hedged zero-duration index, is designed to reduce the impact of rising Treasury yields as US 10-year yields near 4.8%.
ETF Trends highlights the WisdomTree Interest Rate Hedged U.S. Aggregate Bond Fund, ticker AGZD, as investors look for ways to manage bond-market volatility tied to higher Treasury yields. The fund turns 13 years old in December and tracks the Bloomberg Rate Hedged U.S. Aggregate Bond Index, Zero Duration, with the stated aim of mitigating negative effects from rising government borrowing costs.
The outlet points to recent moves in rates as context for why a hedged approach is drawing attention. According to Morningstar, US 10-year Treasury yields rose to 4.78%, the highest since January 2025, while the Japan 10-year benchmark reached 3.0%, its highest since 1996.
ETF Trends also links the hedging focus to expectations for further policy tightening. It cites comments from Federal Reserve chair Kevin Warsh in Jackson Hole, along with CME FedWatch data showing investors forecast a two-thirds chance of a rate hike later this month, up from less than 40% a week earlier.
The article argues AGZD’s structure may appeal to fixed income investors who still want aggregate-bond exposure but want to reduce rate sensitivity. It notes that traditional aggregate bond ETFs can be loaded with rate-sensitive Treasuries, while AGZD aims to keep the aggregate while disposing of that rate exposure during yield surges, according to the outlet.