FYI: Investors snapped up riskier securities in July as broadly positive corporate earnings and a benign economic backdrop renewed the search for yield.
Flows into exchange-traded funds that buy corporate debt rebounded from a lackluster June to the highest level this year, absorbing more than $4.7 billion. High-yield bonds proved particularly popular, with almost $2.6 billion flooding into these ETFs to more than offset outflows a month earlier. Funds owning convertible debt—bonds that give their holders the option to switch from debt to equity—also had their best month all year.
While money swelled all categories of debt ETFs surveyed by Bloomberg, more conservative funds attracted less of the bounty. Government bonds, which are widely regarded as the safest asset class, lured the least money this year, and ultra-short-term funds, those with debt that matures in less than a year, had their worst month since January.
Flows into investment-grade notes also eased from a month earlier. But preferred debt defied the risk-taking trend, absorbing more than $1 billion, the most this year.
Regards,
Ted
https://www.bloomberg.com/graphics/etf-fund-flows/?srnd=etfcenter
