How to Prepare for 2024 Fixed Income Opportunities

Following a tumultuous 2022, this year has been better, though not entirely sanguine for fixed income investors. 2024 is right around the corner, and expectations of rate cuts by the Federal Reserve are rising. Now is the ideal time for advisors to evaluate opportunities in the bond market.

That will be the focal point of VanEck’s upcoming webinar, “Fortify Your Fixed Income Portfolio,” which advisors can register for here. On the webcast, Fran Rodilosso, head of VanEck ETF fixed income portfolio management, and William Sokol, director of ETF product management at the firm, will be joined by Coulter Regal, VanEck product manager, and VettaFi Head of Research Todd Rosenbluth.

They’ll discuss a variety of fixed income segments that could be attractive in 2024. These segments include collateralized loan obligations and floating rate notes. Those corners of the bond market are accessible with VanEck ETFs. Two such examples are the actively managed VanEck CLO ETF (CLOI) and the VanEck IG Floating Rate ETF (FLTR).

CLOI, FLTR Meaningful Fixed Income ETF Considerations

Rate cuts by the Fed would likely unleash a wave of elevated risk appetite in the bond market. CLOI and FLTR are among the ETFs that could be ideal for advisors looking to mitigate bond risk in 2024 while keeping clients’ income profiles high.

Take the case of CLOI. Rodilosso noted that much of the downside risk in this bond segment is priced into issues today. That indicates there could be value with CLOI, which offers a 30-day SEC yield of 6.07%. And more than 87% of its holdings are rated AAA, AA or A. Plus, the $244.8 million CLOI features a spread duration of just 2.03 years. That indicates rate risk is relatively benign with the ETF.