3 Strong, High-Yield Income ETFs

As credit spreads narrow, fewer and fewer high-yield ETFs are compelling buys. There are exceptions, and I'll be showcasing three of these in this article: CEFS, CLOZ, and JEMB. CLOZ's CLO portfolio provides the highest 7.3% dividend yield and strongest risk-adjusted returns. CEFS's closed-end fund portfolio provides a reasonable 6.6% dividend, but outstanding total returns since inception. JEMB's emerging market bond portfolio offers a 6.3% yield, with a short but outstanding track record.

This idea was discussed in more depth with members of my private investing community, CEF/ETF Income Laboratory.

Credit spreads are nearing historical lows, reducing the risk-adjusted income and expected returns of riskier, higher-yielding bonds and bond ETFs. Although most of these are still reasonable enough investments, on account of their headline dividend yields, risk-return seems below average.