Top Fixed Income Funds for 2016–2017: Best Performers Overview
Explore the top fixed income investment funds from 2016–2017, including ETFs focused on high-yield bonds, emerging markets, and interest rate hedging strategies. These funds offer diverse options for investors seeking stable income and potential growth through fixed income securities, with varying risk levels and maturities. This overview highlights the best performers, their investment strategies, and risk considerations for informed decision-making in fixed income investing.
Top Performing Fixed Income Investment Funds of 2016–2017
Fixed income assets continue to attract investors due to their regular payment structure and reliable income flow. Besides individual bonds, this category encompasses money market funds, certificates of deposit (CDs), bond mutual funds, and ETFs focused on fixed income securities. These funds pool various fixed income instruments, offering diversified exposure across regions, credit qualities, and maturities, and are traded as individual units during market hours.
Below are some of the standout fixed income investment funds from 2016–2017, showcasing a mix of U.S. and international bonds with different credit profiles and durations.
VanEck Vectors Fallen Angel High-Yield Bond ETF (ANGL)
This ETF tracks bonds that were originally rated investment grade but later downgraded to junk status, known as “fallen angels.” The fund seeks value by investing in these distressed credits, betting on potential upgrades that could lead to price appreciation. It primarily holds U.S. dollar-denominated bonds, with some exposure to non-U.S. issuers, but carries credit and interest rate risks due to high durations.
ProShares High Yield-Interest Rate Hedged ETF (HYHG)
HYHG aims to hedge against interest rate fluctuations while maintaining high-yield exposure. It shorts U.S. Treasuries across various maturities and goes long on high-yield corporate bonds from the U.S. and Canada issued within the last five years. Its strategy minimizes interest rate risk but concentrates risk in higher-yield assets and limited trading volume can pose challenges.
Guggenheim BulletShares 2022 High Yield Corporate Bond ETF (BJSM)
This ETF invests in high-yield corporate bonds maturing in December 2022, acting more like a bond than a typical fund. It offers a targeted maturity date, with declining yield and duration approaching this point. Upon maturity, the fund returns capital to investors, making it an effective tool for building bond ladders. Its reasonable fees make it a solid choice for accessing a diversified pool of high-yield U.S. bonds.
AdvisorShares Peritus High Yield ETF (HYLD)
HYLD seeks high current income and capital growth by investing in junk bonds, loans, and high-yield securities without strict diversification. The fund's holdings can be sector- or industry-specific, and it sometimes uses leverage or inverse ETFs for hedging. It has higher expenses and lower liquidity, posing certain risks for investors.
VanEck Vectors Emerging Markets High Yield Bond ETF (HYEM)
This ETF tracks bonds issued by emerging market companies rated below investment grade, primarily in U.S. dollars. The holdings include about 350 bonds from countries like Brazil and the Philippines, providing exposure to emerging markets’ high-yield debt. The fund offers less interest rate sensitivity but experiences wider spreads, lower liquidity, and higher costs due to tracking and operational factors.
