Waterloo Capital Trims Bond ETF Stake

On Nov. 5, 2025, Waterloo Capital reported selling 119,651 shares of the iShares 0-5 Year Investment Grade Corporate Bond ETF (NASDAQ:SLQD) in its 13F filing for Q3 2025, an estimated $6.05 million transaction.

What happened

According to a Nov. 5, 2025, SEC filing, Waterloo Capital has reduced its position in iShares 0-5 Year Investment Grade Corporate Bond ETF by 119,651 shares. Following the transaction, the fund held 221,451 shares valued at $11.26 million.

What else to know

Waterloo Capital's SLQD holdings now represent 0.84% of its reportable U.S. equity AUM.

Waterloo's top holdings after the filing, as of Sept. 30, 2025:

• IVV: $49.89 million (3.7% of AUM)
• SPYG: $42.89 million (3.2% of AUM)
• WMT: $41.59 million (3.1% of AUM)
• ACIO: $36.53 million (2.7% of AUM)
• AAPL: $33.64 million (2.5% of AUM)

As of November 4, 2025, shares were priced at $50.64, underperforming the S&P 500 by 12.08 percentage points over the last year. SLQD’s dividend yield was 4.08%, and the ETF closed 0.66% below its 52-week high.

Company overview

Company snapshot

The iShares 0-5 Year Investment Grade Corporate Bond ETF offers targeted exposure to short-term, investment-grade U.S. corporate bonds, providing investors with a balance of yield and credit quality. With a substantial asset base and a focus on high-quality issuers, this ETF is positioned as a core fixed income holding for investors seeking stability and income in a low-duration format.

Foolish take

Waterloo Capital sold roughly 35% of its SLQD position in early November, reducing holdings from about 341,000 shares to 221,000. While the $6.1 million sale sounds significant, this appears to be routine portfolio rebalancing.

Institutional investors like Waterloo Capital constantly adjust their holdings for various reasons, such as client redemptions, rebalancing to maintain target allocations, or simply taking profits after a solid year-to-date performance. Notably, Waterloo still maintains a substantial $11.26 million position in SLQD, suggesting it hasn't lost confidence in the ETF itself.

This is normal institutional trading activity. If you own SLQD for its low-risk income and stability, there's no reason to react to one fund's portfolio adjustment. Focus on whether SLQD still meets your own investment goals. What makes SLQD particularly attractive is its rock-bottom 0.06% expense ratio -- among the cheapest in its category -- combined with an approximate 4% yield and monthly distributions. For conservative investors seeking income with minimal risk, SLQD is a practical buy-and-hold option.

Glossary

ETF (Exchange-Traded Fund): An investment fund traded on stock exchanges, holding assets like stocks or bonds.

Investment grade: Bonds rated as relatively low risk of default by credit rating agencies.

Corporate bond: A debt security issued by a corporation to raise capital, typically paying periodic interest.

Short-duration: Refers to bonds or portfolios with relatively short average maturities, reducing interest rate risk.

AUM (Assets Under Management): The total market value of assets a fund or manager oversees.

Dividend yield: Annual dividends paid by an investment, expressed as a percentage of its current price.

Reportable AUM: The portion of total assets under management that must be disclosed in regulatory filings.

Fixed income securities: Investments that pay regular interest, such as bonds or notes.

Index components: The individual securities that make up a financial index tracked by a fund.

Indicated dividend yield: The projected annual dividend, based on recent payouts, as a percentage of the current price.

Total return: The investment's price change plus all dividends and distributions, assuming those payouts are reinvested.

Credit exposure: The risk level a portfolio has to potential default by bond issuers.

Sara Appino has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple and Walmart. The Motley Fool has a disclosure policy.