Look to EM, High-Yield Bond ETFs in Rising Rate Environment

“On the emerging markets equities side, we think there is still room to run as cash flow for emerging markets stocks continues to grow. After several years of underperformance, investors may still be under allocated to emerging markets equities. As the turnaround in this asset class continues, we expect this to change,” Van Eck said.

Van Eck also singles out China, arguing that the emerging country “holds an important role within the world economy. If China experiences a slowdown, virtually every asset class would be affected. ”

ETF investors can also target the emerging market through equity plays like the VanEck Vectors ChinaAMC SME-ChiNext ETF (NYSEArca: PEK) and VanEck Vectors ChinaAMC CSI 300 ETF (NYSEArca: CNXT), which provide exposure to Chinese mainland stocks or A-shares market.

For more information on the fixed-income market, visit our bond ETFs category.