The primary reason bond ETFs are selling off is **NOT** due to credit stress. It's interest rate risk. Anticipation of rate hikes by the Fed is inflicting damage to fixed income all across the curve. This is DIFFERENT than credit spreads blowing ou

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Kyla Scanlon @kylascan · Feb 18, 2022

From kyla.substack.com

- We can look at the difference between HYG and HYGH to parse out the relationship a bit more - HYG has credit risk and interest rate risk and HYGH has only credit risk (Jack Farley has a great thread on this and special thanks to him for sharing the below charts with me) - HYG (purple line) is down 5.08% and HYGH (purple line) is down 2.64%.

Tweet Feb 8, 2022

The primary reason bond ETFs are selling off is **NOT** due to credit stress. It's interest rate risk. Anticipation of rate hikes by the Fed is inflicting damage to fixed income all across the curve. This is DIFFERENT than credit spreads blowing ou

by Jack Farley

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