BondBloxx JPMorgan USD Emerging Markets 1-10 Year Bond ETF

XEMD

Market cap $916M

From a new Fed chair nominee to a hard turn to risk-off trading in some parts of the market - the broader landscape is rapidly changing for ETF investors. BondBloxx ETFs co-founder Joanna Gallegos and Strategas Securities technical strategist Todd Sohn sit down with CNBC's Dominic Chu to discuss this and much more on “ETF Edge.

BondBloxx JP Morgan USD Emerging Markets 1-10 Year Bond ETF targets U.S. dollar-denominated EM sovereign and quasi-sovereign bonds with capped duration. XEMD boasts a strong recent performance: +13.6% in 2025 YTD and a portfolio split roughly 50/50 between investment-grade and sub-investment-grade debt. Current EM credit spreads are historically tight, limiting immediate upside; XEMD is rated 'Hold' pending more attractive entry points.

Geopolitical and economic uncertainty — and gold touching $4,000 an ounce — is pushing income-seeking investors back toward the best bond ETFs.

Recent data is highlighting why investors should consider adding more exposure to emerging markets. S&P Global research found that at the end of April, the Emerging Market PMI Output Index was sitting at 53.6.

Emerging markets debt proved sturdy in 2023. And more of the same could be on the way this year.

Last year, the market consensus was that there would be a recession in the second half of 2023. Instead, economic indicators have consistently outperformed market expectations.

Despite poor performance in 2022, emerging markets sovereign debt funds outperformed U.S. Treasury and investment-grade corporate bond indexes in 2023. And given resilient global conditions, including moderate inflation and a weakening U.S. dollar, EM debt could be an appealing asset.

It's the end of the year, so for investors, that means seeking tax-loss harvesting opportunities. And emerging markets bond investors in particular should really consider tax-loss-harvesting their positions.

While the headlines for emerging markets (EM) weren't great in 2022, things have picked up since last year. Local EM interest rates and currency markets have been quite compelling, thanks in part to high interest rates and decelerating inflation momentum.