Bonds Fed rate cuts former Goldman Sachs ETF head

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ETF investing has 'gotten more nuanced,' says BondBloxx co-founder as investors seek higher yields

BondBloxx ETFs: A New Frontier in Fixed-Income Investing

Bonds have long been considered a safe haven for investors seeking stability and income. However, according to Tony Kelly, co-founder of BondBloxx ETFs and former global ETF head at Goldman Sachs Asset Management, the fixed-income market is evolving into a place where investors can not only preserve capital but also generate attractive returns.

In a recent interview on CNBC’s “ETF Edge,” Kelly discussed the changing landscape of fixed-income investing, noting that advisors are becoming more strategic in their approach as interest rates are no longer near zero percent.

Following the Federal Reserve’s recent decision to cut interest rates by a quarter point, the benchmark 10-year Treasury Note yield has risen above 4%, signaling a shift in the market environment. Kelly believes that bonds are now offering investors opportunities for diversification, income, and tactical plays.

Emerging Trends in Fixed-Income ETFs

One area that Kelly highlights as a standout performer is emerging market debt, which has been one of the top returning asset classes in the fixed-income market this year. Additionally, there is a growing interest in private credit ETFs, which provide investors with access to institutional-style yields with the added benefit of daily liquidity.

“We have seen a lot of interest in private credit ETFs as a subset of the fixed-income asset class. We currently have a private credit ETF product in the market and another in registration,” Kelly explained.

Overall, the fixed-income market is becoming more nuanced, offering investors a range of opportunities to enhance their portfolios and navigate the changing interest rate environment.