Tag: ETF bond

As we explore the current fixed income market, investors should consider the risks associated with inflation and consider alternative strategies on the loan and credit space. 

Getting targeted fixed income exposure can help extract more yield in the current market, which is inherent to both the  Global X TargetIncome 5 ETF (TFIV)  and the  Global X TargetIncome® Plus 2 ETF (TFLT) . Both funds offer investors an alternate income stream that outdoes Treasury yields.

Fixed income investors know credit quality matters, and that’s particularly true with corporate bonds. Corporate debt with investment-grade ratings feature lower yields, but less risk. Those with junk grades sport higher yields to compensate investors for higher risk.

Data confirm corporate borrowers are again taking advantage of favorable interest rates to issue new debt. That could be a sign that investors may want to apply more scrutiny to exchange traded funds providing exposure to corporate bonds.

Investors’ appetite for ETFs is only growing, and that includes a growing interest in bond funds. Invesco offers up three (among many) for consideration. A State Street Global Advisors report noted that “ETFs first gained institutional credibility in the world of equities, but they are now a popular and proven vehicle with which to access the fixed income market.” “Investors have plans to increase ETF use within their larger fixed income portfolios,” the report said. 

Short-term bond funds can be great places to park cash. Vanguard has a pair of shorter duration options to consider. Even with the Federal Reserve not looking at rate hikes for another year or so, short-term bond funds still have their place in a portfolio.

As equity-based environmental, social, and governance (ESG) exchange traded funds swelled in popularity in recent years, consistently breaking assets under management records for the category, a common refrain emerged. Advisors have asked: when will fixed income ESG ETFs join the party?

There are times when an investor wants aggregate U.S. bond exposure and other times when targeted duration (short or long) is necessary given the current market environs—whatever the need, Vanguard offers suitable ETFs. In this case, it’s getting U.S. bond exposure that strikes a chord with investors transparency, liquidity, diversification, and cost concerns.

Bank loans and high-yield bonds both offer some of the highest yields in the fixed income market today. Both are worth consideration for those investors who are willing to take additional risks to earn higher yields, but bank loans are starting to look a bit more attractive than high-yield bonds today.

KraneShares has unveiled an actively managed fixed income ETF on NYSE Arca targeting opportunities in Asia Pacific’s high-yield bond market.The KraneShares Asia Pacific High Yield Bond ETF (KHYB US) has been created by repurposing the previously launched KraneShares CCBS China Corporate High Yield Bond USD Index ETF.

Treasury yields started off the trading week by ticking lower, but more yield can be had with greater risk and the Vanguard Extended Duration Treasury Index Fund ETF Shares (EDV) . A scramble toward safe-haven bonds took place, putting downward pressure on yields and upward momentum for bond prices.

The Invesco Taxable Municipal Bond Fund (NYSEArca: BAB) once featured “Build America bonds” in its name, hence the ticker “BAB.” While the exchange traded fund’s name changed, it remains one of the premier avenues for accessing a broad portfolio of taxable municipal bonds, and with some market observers seeing signs of life in the often overlooked Build America Bond arena, BAB may warrant consideration from income-oriented investors. 

Treasury yields have been falling to new lows as of late, but ETF investors can still capture the moves with the  Vanguard Total Bond Market Index Fund ETF Shares (BND) . Another rise in Covid-19 cases has been spooking investors, leading to heavy sell-offs in stocks. “U.S. Treasury yields continued to slide on Monday, with the 10-year benchmark rate falling to its lowest level in five months,” CNBC reported .