HYLB: Shorter Duration Helps, But Credit Risk Is Rising

Impact · against what's priced in

HYLB remains a cautious hold as rising credit risk outweighs the benefits of its low expense ratio and short duration. The high concentration of B/CCC rated credits makes the fund vulnerable to current credit stress and bearish technical momentum.

HYLB−0.20

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In context

While the 3.07-year duration limits rate sensitivity, a 38.7% exposure to B/CCC credits increases vulnerability to defaults amidst recent spread widening and a bearish technical trend.

Read from the article alone

• junk bondsNew
• duration▲400%
• etf▲27%
• HYLB
• corporate bonds
• credit risk
• fixed income