Investors who want to protect against rising rates should begin shifting away from long-term debt and move into short-duration assets. Short-duration bonds are less sensitive to rising rates than long-term debt. Some options include the Vanguard Short-Term Bond (NYSEArca: BSV), Guggenheim Enhanced Short Duration Bond (NYSEArca: GSY) and PIMCO Enhanced Short Maturity (NYSEArca: MINT). [Short-Term Bond and Bank Loan ETFs for Higher Rates]
Moreover, investors can take a look at the PowerShares Senior Loan ETF (NYSEArca: BKLN). Senior loans are high-yield bonds with floating rates, which essentially removes interest-rate risk. [Bank Loan ETFs: Shelter from the Rising-Rate Storm]
For more information on the bond market, visit our bond ETFs category.
Max Chen contributed to this article.
Full disclosure: Tom Lydon’s clients own BSV.