Consequently, ETF investors can target various U.S. government bonds to help hedge against the risks. There are a number of Treasury bond ETF options with varying maturities like the iShares 1-3 Year Treasury Bond ETF (NYSEArca: SHY), iShares 7-10 Year Treasury Bond ETF (NYSEArca: IEF) and iShares 20+ Year Treasury Bond ETF (NYSEArca: TLT).
ETF investors may also consider investment-grade corporate debt, such as the iShares iBoxx $ Investment Grade Corporate Bond ETF (NYESArca: LQD), to capitalize on a stronger corporate America and more attractive yield opportunities.
“Stronger growth favors credit over Treasuries,” according to BlackRock. “We generally prefer up-in-quality exposures and investment-grade bonds due to elevated credit market valuations.”
For more information on the fixed-income market, visit our bond ETFs category.