HYS has an effective duration of just 1.96 years while SJNK’s modified adjusted duration is just 2.19 years.
The newly minted WisdomTree BofA Merrill Lynch High Yield Bond Zero Duration Fund (NasdaqGM: HYZD) is another low duration, high-yield ETF to consider.
HYZD, which launched in December 2013, has a negative effective duration, an embedded income yield of 4.14% and an average yield to maturity of 4.83%, according to WisdomTree data. Over 77% of the ETF’s holdings are rated B or BB.
HYZD holds short positions in two- and five-year U.S. Treasury features as well as long positions in bonds from issuers such as Sallie Mae (NYSE: SLM), Sprint (NYSE: S) and General Motors (NYSE: GM).
SPDR Barclays Short Term High Yield Bond ETF
Tom Lydon’s clients own shares of JNK and HYG.