De-Risk Your High Yield Allocation

April 5, 2023

Income is back, but income-seeking investors in today’s widely expected recessionary environment must avoid excessive risk. Watch this video to see how WFHY goes beyond traditional approaches to help you mitigate risk while pursuing high yield.

Income really is back in fixed income, and that’s something investors can be excited about. Yields have jumped in key maturity sectors across bond markets in the developed world, boosting income to levels we haven’t seen in a generation. But high yield investing typically brings elevated credit risk. And today, the combination of inflation, volatility, rate changes and recession make risk management even more critical.

To help capture high yield in this environment, one opportunity could be the WisdomTree U.S. High Yield Corporate Bond Fund, ticker WFHY. History shows that fundamentally sound companies tend to have positive cash flows. WFHY takes this into account providing a critical quality screen by investing in public issuers but eliminating those with negative cash flows — companies that could potentially be burdened with elevated credit and default risk. With this approach, WisdomTree combines a quality-screened, high yield strategy as a core Fixed Income vehicle, so investors could benefit from risk mitigation as they pursue today’s higher yield. WFHY can be used as a standalone solution, or as part of a core plus approach.

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