XB ETF

The outlook for U.S. high yield fixed income may be more constructive than investors realize. High yield is well-known for being riskier than other segments in the fixed income market; however, strong corporate fundamentals have strengthened the integrity of the asset class.

High yield continues to live up to its name. In fact, it was the only major fixed income asset class to generate positive performance in August.

Issuers of high yield bonds remain resilient going into the second half of 2023, with their balance sheets still well-positioned. And according to BondBloxx, the credit quality breakdown within high yield remains better than before previous downcycles.

The prospect for income generation in high yield ETFs has increased significantly with the past year's run-up in yields. But when targeting high yield, investors should be shrewd and selective when picking their entry points.