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| BondsOnline.com: instant access to and extensive coverage of over 3.5 million stocks, bonds, indexes and other securities covering major and emerging markets and exchanges across the globe. |
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| Bonds Online |
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| 5/10/2013Market Performance |
| Municipal Bonds |
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S&P National Bond Index
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3.00% |
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S&P California Bond Index
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2.96% |
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S&P New York Bond Index
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3.13% |
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S&P National 0-5 Year Municipal Bond Index
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0.70% |
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| S&P/BGCantor US Treasury Bond |
400.09 |
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| Income Equities: |
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| Preferred Stocks |
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S&P U.S. Preferred Stock Index
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848.03 |
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S&P U.S. Preferred Stock Index (CAD)
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636.26 |
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S&P U.S. Preferred Stock Index (TR)
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1,701.05 |
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S&P U.S. Preferred Stock Index (TR) (CAD)
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1,276.26 |
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| REITs |
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S&P REIT Index
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174.07 |
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S&P REIT Index (TR)
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425.30 |
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| MLPs |
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S&P MLP Index
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2,469.58 |
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S&P MLP Index (TR)
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5,428.50 |
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See Data
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Juicy and Junky High Yield ETFs |
ETFChannel.com - June 17, 2010
In current economic times when an investor is lucky to get a 1.25% return on a one year CD, many equity investors are turning toward dividend paying stocks and other higher yielding instruments.
Turning to ETFs for yield there are a slew of new entrants into the yield or income category. Some ETFs like Vanguard Total Bond ETF (BND), are relatively safe. But alas with that safety comes lower income. BND only yields 3.6% currently. If you want yield (low) and safety from inflation there are ETF like iShares TIPs Bond ETF which invested in inflation protected Treasuries.
But most investors these days want a lot more than one to four percent on their capital. For those willing to take more risk and dabble in the high yield segment there are an array of choices. But remember high yield is not referred to in the trade as "junk" for nothing. These ETFs hold riskier bonds in their portfolios. For example the highest yielding ETF, Barclays High Yield Bond fund owns slugs of newspaper company McClatchy Co's junk bonds as well as homebuilder Hovnanian's paper. These are businesses and companies with challenging futures. So when you buy these ETFs you should be aware that there is real risk in those juicy yields.
So if you are a packaged product fan and prefer ETFs to straight bonds, then you need to drill down into the ETF holdings. Buyer beware.
Looking at ETFChannel.com's Top Yielding ETFs, the highest yielding options tend to be Debt-based ETFs, rather than ETFs that hold equities.
Below are some of the ETFs with higher yields and a look at what they are holding:
1) SPDR Barclays Capital High Yield Bond ETF (NYSE: JNK) - yield of 9.53% - holds a portfolio of high yield bonds including those issued by CIT Group (NYSE: CIT) which is their largest holding at almost 4.5% of the ETF. Some other familar names of bond issuers the ETF holds are American International Group (NYSE: AIG), and Citigroup Capital (NYSE: C). According to the SPDR web site, bond funds contain interest rate risk - as interest rates rise bond prices usually fall; the risk of issuer default; and inflation risk. Additionally lower-quality debt securities involve greater risk of default or price changes due to potential changes in the credit quality of the issuer.
2) iShares iBoxx $ High Yield Corporate Bond Fund (NYSE: HYG) - yield of 8.98% - holds a large portfolio of corporate bonds, however no one position makes up more than 1.18% of the portfolio. Some recognizable names of issuers include NRG Energy (NYSE: NRG), Blackrock, Community Health Systems (NYSE: CYH), Sprint Nextel (NYSE: S) and First Data.
3) PowerShares High Yield Corporate Bond Portfolio (NYSE: PHB) - yield of 8.95% - holds a portfolio of corporate bonds rated below investment grade by Moody's, S&P or Fitch. The ETF's top holding is a Chesapeake Energy (NYSE: CHK) bond with a coupon of 6.5% and it makes up 2.11% of the ETF. Other familiar names of issuers include Jaden Corp, Echostar (NASDAQ: SATS), and L-3 Communications (NYSE: LLL). According to S&P's ratings, 40.67% of this ETF is rated BB/Ba with another 47.84% at B/B.
4) Claymore/S&P Global Dividend Opportunities Index ETF (NYSE: LVL) - yield of 5.83% - invests in common stocks, master limited partnerships and American depositary receipts that offer high dividend yields chosen from a universe consisting of the stocks listed on the exchanges of those countries included in the S&P/Citigroup Broad Market Index. The ETF's largest holding at 3.96% of the ETF is the Yellow Pages Income Fund (Toronto: YLO-UN.TO), followed by Penn West Energy Trust (NYSE: PWE), Peyto Energy Trust (Toronto: PEY-UN.TO), National Retail Properties (NYSE: NNN) and Nintendo.
ETFChannel.com employees and affiliated entities may have positions or business interests in securities, ETFs or commodities covered.
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| Stuff to look at |
Yield and Income Newsletter: A must have for income investors. subscribe NOW
S&P Commentary and Newsletters: S&P
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| BondsOnline Advisor |
Income Security Recommendation January 2013 Issue.
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