'HYIH' Bond ETF Built for Interest Rate Risk

Although the fund is designed to reduce interest rate risk, it does not subject investors to a reduced income profile. HYIH yields just over 7%.

HYIH’s underlying holdings are the Xtrackers USD High Yield Corporate Bond ETF (HYLB) and the Xtrackers High Beta High Yield Bond ETF (NYSEArca: HYUP).

“In summary, the current low bond yields indicate that only moderate growth is expected. The gap between conventional and inflation-protected bond yields has increased slightly since mid-2016 but remains small,” according to DWS research. “Inflation expectations are trending upward but remain historically low. The Fed is therefore normalizing its monetary policy in small steps, resulting in a gradual interest-rate increase. History has shown that stock markets perform positively when only a modestly rising interest-rate environment is expected. We therefore retain our positive expectation for equities.”

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