They're Back: The (Renewed) Case for Corporate Bonds

As interest rates emerge from the depths, bond investors are faced with a tough challenge. How can advisors balance attractive yield generation against potential credit and interest rate risk?

In the upcoming webcast, They’re Back: The (Renewed) Case for Corporate Bonds, Howard Greene, Senior Managing Director and Senior Portfolio Manager, Manulife Investment Management; and Will Creedon, Director of ETF Capital Markets, John Hancock Investments, will highlight new fixed income strategies that are better-suited to rapidly changing market conditions.

John Hancock Investment Management LLC recently launched the John Hancock Corporate Bond ETF (JHCB). The ETF is the first fixed income ETF advised by the firm and is sub-advised by Manulife Investment Management (US) LLC, John Hancock Investment’s affiliated asset manager.

The John Hancock Corporate Bond ETF is actively managed and seeks a high current income level consistent with prudent investment risk. Under normal market conditions, it invests at least 80% of its net assets (plus any borrowings for investment purposes) in corporate bonds. The ETF is managed by Jeffrey N. Given, CFA, Senior Managing Director and Senior Portfolio Manager; and Howard C. Greene, CFA, Senior Managing Director and Senior Portfolio Manager, Manulife Investment Management.

The federal government backstopping U.S. corporate debt during the height of the pandemic gave the bond markets a nice boost, and some hedge funds are expecting that the party isn’t over just yet. Some funds are doubling down on corporate bonds, particularly the riskier and longer duration variety.

“We continue to see demand from ETF investors who would like additional tools to be more granular in this environment to maintain diversification and manage risk in their portfolios,” Steven L. Deroian, co-head of retail product, John Hancock Investment Management, said in a recent note. “JHCB gives investors this access in an actively managed ETF focused on investment-grade corporate bonds.”

Financial advisors who are interested in learning more about corporate bonds can register for the Wednesday, April 28 webcast here.