SPHY - SPHY: Giving Up High Yields For Investment Grade (Rating Downgrade)
2024-06-14 09:42:36 ET
Summary
- SPDR Portfolio High Yield Bond ETF has delivered a decent total return of 17.3% since we initiated our bullish view 18 months ago.
- However, high-yield bonds are no longer as deeply discounted and attractive enough to generate meaningful alpha in our view.
- By rotating into investment-grade bonds, we remain well-positioned to benefit from eventual rate cuts by the Fed while avoiding the potential downside risk of high-yield spreads widening.
- Accordingly, we downgrade our "Strong Buy" rating on SPHY to a "Hold".
The SPDR Portfolio High Yield Bond ETF ( SPHY ) has performed well since we initiated our bullish view with a "Strong Buy" rating on December 28, 2022 . Since then, SPHY has delivered a total return of 17.3%, a decent return over an 18-month holding period....
SPHY: Giving Up High Yields For Investment Grade (Rating Downgrade)