An ETF that invests in convertible securities and provides some shelter from rising interest rates recently broke out to its highest levels since listing over four years ago.

SPDR Barclays Convertible Securities ETF (NYSEArca: CWB) charges an expense ratio of 0.40% and currently pays a 30-day SEC yield of 2.06%.

“Convertibles tend to perform well in a rising-rate environment,” said David Mazza, head of ETF investment strategy at State Street Global Advisors, which manages CWB. “They’re hybrid securities with lower interest-rate sensitivity. They have exposure to the equity market and can do well versus other fixed-income options when rates rise.”

The ETF tracks the Barclays U.S. Convertible Bond >$500MM Index. State Street uses a sampling strategy, so the fund doesn’t hold every security in the benchmark.

Holders of convertible bonds have the option to exchange for preferred stock. [Convertibles ETF]

“The convertible bond acts as a powerful weapon for investors looking to get the potential upside of the equity markets while staying within the more cautious realm of fixed income,” according to a recent Financial Times report.