My understanding is that there are markets where bonds can be bought and sold. An ETF of bonds is just a large fund holding a set of bonds and trying to keep tr

My understanding is that there are markets where bonds can be bought and sold. An ETF of bonds is just a large fund holding a set of bonds and trying to keep track of their current value. Since you know what the return on the bond is, at what price, interest rate and time, you can very easily assess the current value of a bond, especially compared to what you might make if you just bought GICs at the current rate. An interest rate hike today lowers the sell price of bonds purchased at yesterday's rate.