T. Rowe Price US High Yield ETF

THYF

Market cap $822M

Uncertainty is the name of the game right now for investors, but with uncertainty comes opportunity. The myriad of challenges impacting markets right now may also be driving global yields higher.

T. Rowe Price US High Yield ETF (THYF) has preserved investor capital while providing better resilience during market declines. THYF offers a high starting dividend yield above 7% and pays out distributions on a monthly basis. Distributions have remained in a consistent range since inception, demonstrating the ETF's ability to provide reliable income for retirees.

Advisors and investors seeking opportunities beyond passive bond benchmarks, or looking to reduce risk, would do well to consider active fixed income ETFs. In the mercurial markets of 2025, strategies that rely on fundamental analysis to construct portfolios while remaining flexible could prove beneficial.

THYF offers a stable, high-yield income stream with a 7.2% dividend, making it ideal for income-focused investors seeking to offset equity volatility. The fund is well-diversified across industries and issuers, but investors should not expect capital appreciation—THYF is best used as a portfolio supplement. Risks include exposure to below-investment-grade debt and potential defaults, especially if economic growth slows or interest rates remain high through 2025.

The inversion once more of the 10-year and 3-month Treasury yield curve this week reflects a shift to more risk-averse posturing by investors. This year's complex environment creates opportunity for active strategies, particularly within bonds.

While investors have had a close eye on equities all year, fixed income has had strong overall performance. For example, the Bloomberg US Aggregate Bond Index (BBUSATR) has returned 2.6% over one year.

Thought about moving into active fixed income ETFs? The new year could offer an appealing opportunity to dive in.

As 2024 comes to an end, investors may be looking to adjust their bond allocations. With many still sitting in cash and rates coming down, it may be time to adapt or make a shift.

By: Nolan Mauk In the post-pandemic era marked by economic uncertainty, volatility, geopolitical tension, and deglobalization, one thing has been made clear: no market, sector, or asset class is immune to the effects of rapidly changing market cycles.

One of the key themes that emerged from discussion at the recent ETF Exchange conference in Miami was the return of bonds. That said, the return of bonds hasn't necessarily been reflected by recent returns.