One way of looking at THHY is that the ETF offers compensation for the investor that believes interest rates will rise but does not know exactly when that will happen. THHY has a 30-day SEC yield of 4.16% and a yield to worst of 4.48%. Over 81% of the fund’s 64 holdings are rated BB or B, according to issuer data.
“For investors who value liquidity and who believe rising interest rates are on the way, the hedged high yield bond approach may be worth a closer look,” said Rodilosso.
Market Vectors Treasury-Hedged High Yield Bond ETF
ETF Trends editorial team contributed to this post.