Invesco Total Return Bond ETF

GTO

Market cap $1.94B

With the market roughly at the midpoint for 2025, investors and advisors are still assessing how changing macroeconomic conditions could affect their fixed income portfolio. This topic was discussed at length during the VettaFi Midyear Market Outlook Symposium, which brought together experts and portfolio managers to discuss a wide variety of investment approaches.

As investors prepare portfolios for the new year, four fixed income ETFs are worth consideration for 2025. 1. Invesco Senior Loan ETF (BKLN) As investors look for fixed income ETFs well-positioned for 2025, bank loans should not be overlooked.

Most core bond strategies have corporate bond exposure. However, there may be a compelling opportunity to overweight the corporate bond sector.

The Invesco Total Return Bond ETF is an actively managed fund focusing on intermediate yield curve, primarily holding highly rated bonds. GTO's portfolio is diversified among Treasuries, Agency MBS bonds, and corporate IG bonds, with dynamic allocation adjustments by the manager. With a 6.5-year modified duration and 5.75% yield to maturity, GTO capitalizes on elevated yields without significant credit spread risk.

Tax-loss harvesting can be a useful tool for investors when a portfolio experiences capital loss. Several market segments have produced negative returns in 2024, creating tax-loss harvesting opportunities.

These higher-rated strategies have attractive upside.

While markets mull over when the Federal Reserve will begin rate cuts, investors are evaluating where to allocate investments. Justin Danfield, Fixed Income ETF Strategist at Invesco, noted that bond investing presents an attractive option for investors.

Earlier this year, many industry observers and investors were expecting an imminent slowdown with markets. But with rates coming back down and the risk outlook improving, the outlook on fixed income has improved.