Due to the once upon a time investment-grade status of its holdings, ANGL’s profile is tidier than other high-yield bond ETFs with nearly three-quarters of the fund’s weight rated BB. [An Angelic ETF for Junk Bonds]
“Falling from the elysian heights of the credit world does create some opportunities for investors however, as bonds which have lost their investment grade status have gone on to outperform both investment grade and high yield benchmarks over the last couple of years,” adds Markit.
Investors are not required to make a significant yield sacrifice to embrace ANGL’s benefits, including the superior credit quality. The ETF has a 30-day SEC yield of 4.66%, less than 50 basis points below HYG and 260 basis points above 10-year Treasury yields.
Market Vectors Fallen Angel High Yield Bond ETF