New Bond ETF Aims For High Income Through Flexible Multi-Asset Strategy

BY Benzinga | CORPORATE | 09:40 AM EST

Meet the Infrastructure Capital Bond Income ETF (BNDS) ?a new player in the fixed-income space designed to deliver high current income with a side of capital growth.

The ETF, launched Jan. 15, focuses on corporate bonds but also dips into municipal and government bonds, offering a diverse mix. Plus, it's open to bonds of all types?short or long-term, high-quality or even junk?giving it the flexibility to adapt to market opportunities.

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Why This ETF Stands Out

The strategy behind Infrastructure Capital Bond Income ETF (BNDS) is all about spotting undervalued opportunities. Using a proprietary multifactor approach, the team considers everything from credit and liquidity premiums to sector trends. They also keep an eye on the big picture, using a top-down view of the economy to guide decisions.

But it's not just about bonds. Up to 20% of the fund's assets can go into equities, with a focus on preferred stocks. And to keep things interesting, the ETF also plays with options and swaps to manage risk and generate extra income.

"There continue to be opportunities to find both alpha and compelling income in the fixed income markets. The key however is in knowing where to look," says Jay Hatfield, Infrastructure Capital Founder, CEO, and portfolio manager.

More Than Just Another ETF

Infrastructure Capital Bond Income ETF (BNDS) is the latest addition to Infrastructure Capital's growing lineup, which includes popular ETFs like the InfraCap MLP ETF (AMZA) and the Virtus U.S. Preferred Stock ETF . With more than $2 billion in assets under management, the firm is all about helping investors find reliable income in today's markets.

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Photo: Shutterstock

In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.

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