Exchange traded funds tracking the S&P 500 and Dow Jones Industrial Average suffered declines of more than 4% in Thursday’s stock market thumping.
Yet in the bond ETF universe, the steep pullback in high-yield corporate bond funds was another example of the “risk off” trade in force on Thursday.
For example, SPDR Barclays Capital High Yield Bond ETF (NYSEArca: JNK) and iShares iBoxx High Yield Corporate Bond Fund (NYSEArca: HYG) absorbed losses of about 3%. The move shows investors were scaling back risk in all parts of their portfolios.
Both high-yield ETFs sliced below their 200-day moving average.