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Covered call ETFs dominate income investing conversations, but leaning entirely on one options strategy carries a hidden long-term cost most investors overlook.
Covered call ETFs offer tempting yields but quietly surrender your upside every time the market rallies. Two fixed-income alternatives push past 11% without that hidden cost, though the trade-offs they demand deserve a hard look before you buy.
Investors are returning to the bond market in force, driving fixed-income ETFs toward another record year as higher yields make bonds attractive for income-seeking investors once again.
The BondBloxx CCC Rated USD High Yield Corporate Bond ETF remains resilient, outperforming leveraged peers in 2026 with only a -4% total return decline. XCCC's performance is anchored by moderate CCC credit spreads and low duration, but the fund's high-risk, distressed credit profile exposes it to default volatility. Current CCC spreads, at 10.13%, sit near historical medians, suggesting neither excessive risk nor opportunity relative to past cycles.
Tony Dong is the founder of ETF Portfolio Blueprint.
BondBloxx CCC Rated USD High Yield Corporate Bond ETF offers high yields but carries significant credit risk due to its focus on CCC-rated bonds. Current high-yield spreads are tight, making XCCC unattractive for new positions; holding is advised if already owned, but avoid new entries for now. The ETF's moderate duration, sector concentration, and high turnover ratio highlight risks tied to refinancing and potential spread widening.
Geopolitical and economic uncertainty — and gold touching $4,000 an ounce — is pushing income-seeking investors back toward the best bond ETFs.
Very few high yield funds go right at the bottom of the barrel to get returns. XCCC is a rare bird that dives head first into the CCC rated bonds. Interestingly enough, it has taken CLO funds like ECC and OXLC to the cleaners since its inception.
SEC filings for XCCC aren't indexed yet — common for recently launched funds. Browse the issuer's filings on SEC EDGAR directly.