Rising Rates: How to Protect Yield Generation

ETF Trends publisher Tom Lydon discussed the ProShares High Yield Interest Rate Hedged ETF (HYHG) on this week’s “ETF of the Week” podcast with Chuck Jaffe on the MoneyLife Show.

HYHG is an ETF play to protect yield generation in a rising rate environment.

Investors don’t need to sacrifice yield and go down the yield curve to short-term debt to hedge in a rising rate environment. Investors historically shifted into lower duration or short-term bond securities to limit the negative effects of rising rates.

With a rate-hedged bond ETF, investors can generate the same level of yields they have been accustomed to and still limit rising rate risks.