Redemption & Reality in High Yield ETFs
Recently there has been series of redemptions out of HYG and other high yield ETFs. These trades have been at times misunderstood by market participants, so I’m going to try to provide some clarity.
Recently there has been series of redemptions out of HYG and other high yield ETFs. These trades have been at times misunderstood by market participants, so I’m going to try to provide some clarity.
Today’s Best of the Bond Market.
Over the past few months we have seen a lot of investors looking for ways to add yield to their portfolio, through investments such as high dividend stocks and higher yielding bonds investments.
Wednesday April 11th marked the 5 year anniversary of when HYG began trading. When we launched HYG (the iShares iBoxx High Yield Fund) five years ago, a number of investors were skeptical.
For the first time in a number of months, long-depressed interest rates have recently started to move up. The 10 year Treasury entered March at 1.97%, having been below 2.10% since last October.
The LearnBonds comprehensive guide on how to buy bonds.
While we are certainly not recommending that long term investors speculate on changes in interest rates, those who are going to speculate on the bond market with inverse ETFs should keep the following in mind…
First, the bad (and obvious) news: When it comes to investing, you can’t control returns.
At the beginning of 2012, there were only 39 actively managed ETFs with $5 billion of assets. Why have active ETFs not taken off? . .
Financial Advisers Lose: Why would and investor pay a 2 or 3% load fee for the privilege of investing in the PIMCO Total Return Fund when they can buy the ETF? . .