Hints and tips:
...McManus said that in Nutmeg’s view, the biggest risk to US equities was a rise in bond yields....
...For example, from December 1 2021 to September 27 2022, the iShares Index Linked Gilts Ucits ETF dropped 50 per cent....
...This is where an iShares ETF comes in — the USD Treasury Bond 20+yr UCITS ETF GBP Hedged (IDTG). This is a tracker fund that’s hedged against the dollar....
...High-yield bond ETFs gathered $11.6bn globally, including $10.8bn in US-listed ETFs, according to BlackRock....
...In contrast, high-yield bonds returned 11 per cent, senior loans 10 per cent and convertible bonds, an equity-fixed income hybrid, also 10 per cent....
...That compares with flows in to European-listed ETFs investing in US high-yield bonds of just under $200mn....
...The volte-face was particularly notable in high-yield bonds, which saw year-to-date net outflows of $8bn as of October 27, but then took in $17.1bn in the remainder of 2023....
...Take an exchange traded fund from iShares called the USD Treasury Bond 20+yr UCITS ETF GBP Hedged (Distributing version), with a ticker IDTG....
...BlackRock’s giant $61.9bn iShares Core S&P 500 Ucits ETF, Vanguard’s $38.6bn S&P 500 Ucits ETF and Amundi’s $8.2bn Lyxor S&P 500 ETF each charge 0.07 per cent....
...The iShares iBoxx $ High Yield Corporate Bond ETF (HYG) and SPDR Bloomberg High Yield Bond ETF (JNK) bore the brunt, with outflows of $2.8bn and $1.6bn respectively, according to VettaFi’s data....
...However, as the impact of higher global interest rates starts to feed through, investors are being more cautious about jumping into high yield ETFs because the risk of default has been rising, with companies...
...The Macquarie bond strategy can invest up to 100 per cent of its assets in sovereign bonds, up to 70 per cent in investment grade credit and up to 20 per cent in high-yield and/or emerging market debt instruments...
...At nearly 12 per cent it dwarfs the 7.5 per cent that US high-yield bonds pay, and is close to the effective yield of super-junky triple-C bonds....
...“The more favourable fixed income investing environment experienced since 2022 has driven increased adoption of iBonds,” said Brett Pybus, global co-head of iShares fixed income ETFs for BlackRock....
...Luke Hyde Smith is co-head of Multi-Asset Strategies at investment manager Waverton, which gains exposure by investing via the Global X Uranium UCITS ETF....
...That said, the most popular fund, the iShares Core € Corporate Bond Ucits ETF (IEBC), had a more modest trailing yield of 1.6 per cent....
...Only one of the 20 — the $151mn iShares Interest Rate Hedged High Yield Bond ETF (HYGH), the sole fixed income fund on the list — beat the 19.4 per cent decline in the Morningstar US Market Index....
...Shareholders recently approved the transition of the $170mn JPMorgan Global High Yield Corporate Bond Multi-Factor Ucits ETF into an active strategy, with the changes expected to take effect before the end...
...The gap is even more stark for iShares MSCI Japan ETFs. Plaudits to holders of the hedged fund (green line). Closer to home, currencies matter too....
...In particular, Rosenbluth noted that the iShares iBoxx $ High Yield Corporate Bond ETF (HYG) and SPDR Bloomberg High Yield Bond ETF (JNK) took in $2.7bn and $2.6bn respectively in April, while short-term...
...My own favourite fund in this space is from JPMorgan and is called the GBP Ultra-Short Income Ucits ETF, with a yield of maturity of 5.32 per cent....
...The bulk of these assets are held by the SPDR Bloomberg Convertible Securities ETF (CWB) and iShares Convertible Bond ETF (ICVT), both of which are passive, whereas Calamos’s ETF, in line with its mutual...
...Even this buying was defensively focused, with government bonds ETFs accounting for $18.5bn, or 83 per cent, of this, well above the May to July average of 46 per cent....
...The iShares UK Gilts ETF is down 30 per cent over three years; its index-linked sibling is down 35 per cent. In other words, these investments have at least halved in real terms....
...Karim Chedid, head of investment strategy for BlackRock’s iShares arm in the Emea region, said rising bond yields were luring investors into the fixed income market....
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