|Day's Range||0.4200 - 0.4200|
Exchange-traded funds offer an easy strategy for portfolio diversification, but high monthly dividend ETFs also generate steady income distributions desired by income-seeking investors, suggests Ned Piplovic, editor of DividendInvestor.
Interest-rate risk has a much bigger impact on most core investment-grade bond portfolios than anything else. It explains 88% of the Bloomberg Barclays U.S. Aggregate Bond Index's returns over the trailing 10 years through August 2019. This fund targets an equal risk contribution from credit and interest-rate risk.
The Fed recently lowered interest rates and is poised to do so again before the end of this year, likely making longer duration bond funds more attractive to income investors. SHYG seeks to track the investment results of the Markit iBoxx® USD Liquid High Yield 0-5 Index, which is primarily composed of U.S. dollar-denominated, high yield corporate bonds with remaining maturities of less than five years. “To address this issue, this fund screens its holdings for liquidity by their size,” said Morningstar in a recent note.