State Street Global Advisors launched SPDR Barclays Capital Short Term Corporate Bond ETF (SCPB) yesterday (12/17/2009). Numerous new bond ETFs came on the market this year, but this one is especially welcome because it is a ‘corporate’ bond fund.

The new SCPB ETF (fund overview) invests only in investment-grade (average credit quality: A2/A3), short-term corporate bonds that are typically less sensitive to interest rate movements than intermediate or long-term bonds. The fund will have a 0.12% expense ratio.

According to the fact sheet, the underlying index has 572 holdings, a 1.9 year adjusted duration, and a 2.69% yield. There is some confusion in the market regarding ‘corporate’ bond funds and ‘credit’ bond funds, with the terms sometimes used interchangeably. SSGA has put together a Corporate vs. Credit Special Report to help clarify the differences.