ETFs to Protect Against Higher Rates

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ETFs to Protect Against Higher Rates

(New York)

There has been a lot of focus in the media lately about rising rates and what they will mean for investor portfolios. The ten-year yield is now well over 3% again, and the Fed looks likely to hike twice more before the end of the year. If your fixed income exposure (and equity exposure) isn't carefully hedge, it could spell losses. Accordingly, here are three ETFs to help offset rate risk: the SPDR Blmbg Barclays Inv Grd Flt Rt ETF ( FLRN ), the iShares Floating Rate Bond ETF ( FLOT ), and the ProShares High Yield-Interest Rate Hdgd ( HYHG ). The first two rely on floating rate bonds of short maturities, while the ProShares fund goes long corporate bonds and short Treasuries.

FINSUM : The performance of these kind of hedged ETFs has been good since rates started rising a couple years ago. They seem to have an important role to play in portfolios right now.

  • ETFs
  • rates
  • fed
  • hedging
  • bonds

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Bonds
Referenced Symbols: FLRN , FLOT , HYHG

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