Thanks to ETFs, investors now have access to various aspects of the bond markets whether they are domestic, international, investment-grade, high-yield and more.

“A lot of times we think about ETF’s as being a stock or an equity product, but really it’s these fixed income ETF’s that continue to be launched new and ways to access that market,” said Yones. “Wrap it in an ETF wrapper, you can trade it on the Stock Exchange, you’ve got access to fixed income instruments.”

Alternative Strategies in ETFs

Moving forward from the late cycle, investors must be able to employ strategies that best adapt to the changing economic landscape. An area that Dahya sees as beneficial, particularly in a down market, is within alternatives strategies, which employ similar methodologies to those of hedge funds.

“Alternatives is a passion point near and dear to my heart,” said Dahya. “If I think about the broad market context right now, and you look at traditional equity investments, the last nine years we’ve seen very, very strong returns from US equity markets. But, you have to ask the question, ‘What’s the forward looking expectation for them?’ Then you marry that with forward looking expectations for fixed income markets, and their role as a diversifier in a portfolio, and you can see a quite strong case for the role of an alternative. Particularly if you look at something like hedge fund strategies.”

Understanding the market cycle, looking at all ETF options and employing alternative strategies when necessary can help investors change with the times irrespective of whether the market is reigned by the bulls or bears.

Click here to watch all of the latest In the Know segments on the latest updates in ETFs this quarter.