Launched on 07/10/2017, the Inspire Corporate Bond ETF (IBD) is a smart beta exchange traded fund offering broad exposure to the Investment Grade Corporate Bond ETFs category of the market.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
The fund is managed by Inspire, and has been able to amass over $503.14 million, which makes it one of the average sized ETFs in the Investment Grade Corporate Bond ETFs. IBD, before fees and expenses, seeks to match the performance of the Inspire Corporate Bond Impact Equal Weight Index.
The Inspire Corporate Bond Index selects domestic corporate bonds issued by companies that are large capitalization companies, which have an Inspire Impact Score of zero or higher.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.41%, making it one of the most expensive products in the space.
It has a 12-month trailing dividend yield of 4.37%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
When you look at individual holdings, Azo 3 3/4 06/01/27accounts for about 2.38% of the fund's total assets, followed by Cboe 3.65 01/12/27 and Vlo 4.35 06/01/28.
The top 10 holdings account for about 23.32% of total assets under management.
Performance and Risk
The ETF has lost about -1.69% and is down about -1.08% so far this year and in the past one year (as of 10/14/2026), respectively. IBD has traded between $23.00 and $24.37 during this last 52-week period.
IBD has a beta of 0.20 and standard deviation of 5.31% for the trailing three-year period. With about 252 holdings, it effectively diversifies company-specific risk .
Alternatives
Inspire Corporate Bond ETF is not a suitable option for investors seeking to outperform the Investment Grade Corporate Bond ETFs segment of the market. Instead, there are other ETFs in the space which investors should consider.
Vanguard ESG U.S. Stock ETF Shares (ESGV) tracks FTSE US ALL CAP CHOICE INDEX and the iShares ESG Aware MSCI USA ETF (ESGU) tracks MSCI USA ESG Focus Index. Vanguard ESG U.S. Stock ETF Shares has $13.64 billion in assets, iShares ESG Aware MSCI USA ETF has $18.24 billion. ESGV has an expense ratio of 0.09% and ESGU changes 0.15%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Investment Grade Corporate Bond ETFs
Bottom Line
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Inspire Corporate Bond ETF (IBD): ETF Research Reports
This article originally published on Zacks Investment Research (zacks.com).