The bond market has been one of the most closely watched areas in the ETF industry in 2015. The mini flash crash in August has led to outcry about the dangers high-yield ETFs put investors in. Liquidity and defaults loom over the entire conversation fueled by speculation from activist investors like Carl Icahn who think endless interest-rate stagnation has sent a party bus full of high yield ETF investors careening towards a cliff.
Enter Mark Kiesel, PIMCO’s Chief Investment Officer & Managing Director. Fear mongering aside, the reality of rising rates seems to finally be upon us, but the picture the bond expert paints is far less dark. First, yes there are areas of the bond market that rising rates will negatively impact – there’s no denying it and history can tell us exactly where.
The one thing being left out of the conversation? Opportunity. Tom and Mark chatted at the Morningstar ETF Conference recently and he brought a lot to the table on where investors can look for positive returns instead of focusing on speculation of disaster. Not all bonds are equal and rising rates will open doors to careful, diligent investors.
Learn more about where to look by checking out Tom and Mark’s compelling conversation below!