This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Safe Funds That Yield a Bit More Than Money Markets

Investors who seek a steadier parking place than the PIMCO ETF could consider Guggenheim Enhanced Short Duration Bond ETF (GSY), which yields 0.47% and has a duration of 0.33. Over the past 52 weeks, the share price fluctuated from a low of $49.54 to high of $50.18.

Actively managed, the Guggenheim ETF can hold securities that are rated below-investment grade. The fund currently has 5% of assets in Guggenheim BulletShares 2015 High Yield Corporate Bond (BSJF), an ETF that yields 5.2% and has credit quality that is below-investment grade.

"By investing in the high-yield ETF, we can pick up extra yield in an efficient way," says William Belden, Guggenheim's head of product development.

For a high-quality choice, consider RidgeWorth U.S. Government Securities Ultra-Short Bond (SIGVX), a mutual fund that yields 0.85% and has a duration of 0.81 years. The fund focuses on government mortgage securities. Those yield a bit more than Treasuries.

About 40% of assets are in adjustable-rate mortgages. If interest rates rise, the yields on the securities would also climb, protecting shareholders against losses. During the turmoil of 2008, the average ultrashort fund lost money, but RidgeWorth sailed through the crisis and returned 3.5% for the year.

During the past five years, the fund returned 2.7% annually.

"We did not lose money during the financial crisis because we are very conservative about the credit risk we take," says portfolio manager Chad Stephens.

Charles Schwab recently filed to offer an actively managed short-duration ETF, and more companies are likely to follow. With money-market yields stuck at puny levels, investors will continue seeking safe alternatives.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

Stan Luxenberg is a freelance writer specializing in mutual funds and investing. He was executive editor of Individual Investor magazine.
2 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
BSJF $26.02 0.00%
LQD $115.87 0.36%
MINT $101.16 -0.03%
GSY $50.09 0.10%
AAPL $125.75 -0.67%

Markets

DOW 17,638.78 -91.33 -0.52%
S&P 500 2,059.55 -17.23 -0.83%
NASDAQ 4,966.1030 -43.1110 -0.86%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs