High-Yield ETF Performed Well Amid Turmoil

Last September, I wrote about the iShares iBoxx $ High Yield Corporate Bond Fund(HYG Quote), comparing it with Blackrock High Yield Trust(BHY Quote), Dreyfus High Yield Strategies(DHF Quote) and Blackrock Corporate High Yield III(CYE Quote), which are all closed end funds.

A reader question led me to realize that now might be a good time to revisit the issue, since the market situation has changed so much.

Investors can access high-yield bonds through traditional mutual funds, closed-end funds, this ETF and individual issues. Individual issues can be difficult for do-it-yourselfers because of issuer risk and liquidity risk, so that leaves a fund of some sort as the most likely choice.

The general thesis of the article was that HYG, because of the nature of ETFs, would be a less volatile way into the high-yield market than most closed-end funds. ...