Corporate Bonds - Hedging Rising Rates

Components Performance/Risk
Period Return
10.8%
Return Rank
Below Average
Risk Exposure
Low Risk

Anticipations of future interest rate trends turn out to be art rather than science if the past 12 months are any guide

Because markets have been wrong-footed repeatedly, options to buffer the whipsaw risk of rate reversal on bond investments are worth consideration

Straighforward floating rate funds with investment grade characteristics compare favorably with more risky floating rate loans included in the selection 

Alternatively, structured funds (buy-write strategies) and long-short investments dampen interest rate impact

 

To track the market outlook, momentum signals trends of the last 5 days against a 20-day average

For comparison, select various time frames in the top right menu box, from 2 weeks to a full year (performance of some very recently listed ETFs may not be significant for lack of price data

Theme Components
Name
Ticker
Category
SubCategory
Cur. Price
Performance
Momentum
Risk Rank
Risk Contrib
 
iShares Floating Rate Note Fund FLOT Corporate Investment GradeFloating Rate50.929.3% Neutral Low Risk
VanEck Vectors® Investment Grade Floating Rate ETF FLTR Corporate Investment GradeFloating Rate25.546.9% Neutral Low Risk
ProShares Investment Grade-Interest Rate Hedged IGHG Corporate Investment GradeInterest Rate Hedged78.179.2% Neutral Below Average
iShares Interest Rate Hedged Corporate Bond ETF LQDH Corporate Investment GradeInterest Rate Hedged92.8711.8% Neutral Below Average
iShares Interest Rate Hedged Long-Term Corporate Bond ETF IGBH Corporate Investment GradeInterest Rate Hedged24.5611.5% Neutral Average Risk
iShares Investment Grade Corporate Bond BuyWrite Strategy ETF LQDW Corporate Investment GradeCovered Calls23.8318.9% Neutral Average Risk
SPDR® Bloomberg Investment Grade Floating Rate ETF FLRN AggregateFloating Rate30.769.3% Weak Up Low Risk
Invesco Variable Rate Investment Grade ETF VRIG AggregateFloating Rate25.089.3% Weak Up Low Risk
T. Rowe Price Floating Rate ETF TFLR Alternative StrategiesFloating-rate loans50.4510.5% Neutral Low Risk
PGIM Floating Rate Income ETF PFRL Alternative StrategiesFloating-rate loans49.4911.6% Neutral Low Risk
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