CDX: Good Way To Own High Yield Bonds
- Simplify High Yield PLUS Credit Hedge ETF uses a long-short portfolio of high-quality vs. low-quality stocks to hedge credit risk, offering a positive carry credit hedge.
- While CDX offers protection against credit risk, it does not hedge against rising interest rates, posing a risk during periods of increasing rates.
- I rate CDX a buy for its potential to make high-yield bonds more palatable by mitigating downside risks from a negative credit cycle.
tumsasedgars
To be honest, I have a bit of a complicated relationship with Simplify Asset Management, the manager of the Simplify High Yield PLUS Credit Hedge ETF (NYSEARCA:CDX).
On the one hand, I find some of Simplify's products truly innovative
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