State Street SPDR Bloomberg High Yield Bond ETF

JNK

Market cap $7.04B

Most retirees are forced to choose between yield and safety — discover two rare investments that deliver 8%+ income without forcing that painful tradeoff. One is a bond ETF that actually grows its dividend (something almost no bond fund can claim), and the other is a cash-flow machine with 12.5% guided distribution growth. In a volatile market where most high yields are getting crushed, these two holdings have the balance sheet strength, inflation protection, and structural advantages to keep paying and growing.

With the 10-year Treasury yielding around 4.3% and the Fed funds rate at 3.75% after three cuts over the past year, income investors face a tension: Treasuries offer reasonable rates, but meaningful yield requires reaching further out on the risk spectrum.

State Street SPDR Bloomberg High Yield Bond ETF offers competitive expense ratios and exposure to USD junk-grade fixed income. Credit spreads are at historic lows, but structural changes—like higher BB share and some technical effects—justify lower baseline spreads at the moment. The economic backdrop is not fantastic, with weak consumer confidence and stabilizing labor data limiting prospects for further Fed rate cuts.

Prices for raw materials have rocketed higher so far this year, outperforming the rest of the major asset classes by a wide margin through Friday's close (Jan. 23), based on a set of ETFs.

SPDR Bloomberg High Yield Bond ETF ( NYSEARCA:JNK ) isn't actually invested in junk.

Retiring on passive income from dividends is a great way to reduce sequence of returns risk. Many investors generate this income from a basket of high-yield CEFs and ETFs. However, this strategy comes with a lot of risks and shortcomings.

Risk-off mood hits junk bonds as CCC debt slides. While JNK, FTSL, HYLS & peers face pressure, safer plays like LQD should gain investor favor.

These two high-yield funds combine dependable income with exposure to some of the strongest long-term secular trends. They offer high yields that are backed by portfolios filled with high-quality companies. They also trade at very attractive valuations and provide strong dividend growth.

Corporate bonds that are below investment grade status may be less likely to default now. But investors still need to be careful.

The SPDR Bloomberg High Yield Bond ETF offers diversified exposure to US high-yield corporate bonds, aiming to convert credit risk premium into regular income. JNK's performance is driven by coupon income and price changes linked to credit spreads (OAS) and macroeconomic factors like bank lending (SLOOS) and real interest rates. Currently, OAS is in a low-mid range and bank lending is less tight than recent peaks, making carry the main source of return for JNK.