Geopolitical risks, high oil prices, and inflation continue to impact global stock markets. In this scenario, investors seeking steady income can consider adding bond exchange-traded funds (ETFs) to their portfolios. Bond ETFs offer the benefits of diversification at low cost and are easy to access and trade.
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Here, we will look at three bond ETFs offering more than 6% yields: Xtrackers Short Duration High Yield Bond ETF (SHYL), SPDR Bloomberg High Yield Bond ETF (JNK), and iShares Broad USD High Yield Corporate Bond ETF (USHY).
TipRanks’ ETF Comparison Tool gives a snapshot of these three ETFs across key metrics.
Xtrackers Short Duration High Yield Bond ETF (SHYL)
The SHYL ETF tracks the Solactive USD High Yield Corporates Total Market 0-5 Year Index and offers exposure to the high-yield corporate bond market while managing interest rate risk through a short-term focus. Generally, these high-yield bonds with lower credit ratings are referred to as “junk bonds” due to the risk of capital loss relative to investment-grade bonds. However, risk-taking investors prefer these bonds for their high yields.
Notably, the SHYL ETF has paid more than $3.084 per share in dividends over the past year. It offers a dividend yield of 6.95%.
SPDR Bloomberg High Yield Bond ETF (JNK)
The JNK ETF tracks the Bloomberg High Yield Very Liquid Index and provides a diversified exposure to U.S. dollar-denominated high-yield corporate bonds with above-average liquidity. It helps investors capitalize on a diversified mix of high-yield securities, providing an attractive yield relative to traditional investment-grade bonds.
The JNK ETF has paid $6.370 per share in dividends over the past year. It offers a dividend yield of 6.62%.
iShares Broad USD High Yield Corporate Bond ETF (USHY)
The USHY ETF tracks the ICE BofA US High Yield Constrained Index and provides diversified exposure to below-investment-grade rated high-yield corporate bonds. It helps investors gain access to corporate bonds with a wide range of maturities, issued by companies across various industries.
With dividends of more than $2.552 per share paid over the past year, the USHY ETF offers a dividend yield of 6.9%.
