The 10-year Treasury note is yielding an anemic 1.6% so it’s no wonder investors are scouring the bond ETF universe in search of income.
There are the obvious sectors such as high-yield corporate bonds. However, some fixed-income ETFs reside off the beaten path such as emerging market bond funds that might appeal to investors trying to boost yield in their portfolios.
The fund pays a dividend yield of 7% and holds total assets of $12.5 billion, according to manager State Street Global Advisors. JNK has a one-year total return of 21.3%, according to Morningstar. [High-Yield ETFs]
“Typically, speculative-grade bonds come with attractive yields because of their inherently riskier nature. However, default rates remain significantly depressed,” Lydon told IBD. “Meanwhile, corporate America is still sitting on a lot of cash, and balance sheets have been at their best in years.”
Daniel Weiskopf, managing director of Forefront, said his firm has overweight positions in Market Vectors High-Yield Muni ETF (NYSEArca: HYD), SPDR Barclays Capital Convertible Bond (NYSEArca: CWB) and PIMCO Total Return ETF (NYSEArca: BOND).
“The secondary market seems poised for municipal bond prices to move higher,” says James Colby, a portfolio manager and senior municipal strategist at Van Eck Global. [Muni Bond ETFs]