Priya Misra, a portfolio manager at J.P. Morgan Asset Management, is leaning into high-grade bonds right now. On CNBC's ETF Edge, she said investors can "take credit risk in the highest quality companies and still get [a] 6.5% [yield]" and "you actually don't have to go down in credit [quality]." For anyone feeling heavy in AI names, she added, "There's a huge AI exposure." She said, "What fixed income gives you is this diversified set of returns. It's not just an AI trade or a tech trade. You have the Treasury trade. You have credit outside of AI."
Misra co-manages the JPMorgan Core Plus Bond Fund ETF, ticker JCPB. Assets under management total nearly $16 billion, and as of Aug. 31, the firm's website indicates a little more than 75% of holdings are BBB or better. She said the team has been "increasing some of the double-B [and] single-B exposure because there has been a widening in high yield spread," adding, "We like some investment grade." "And now, we've started in the last few days to increase some duration as well, thinking we may be nearing the end of that rate move." Misra also flagged the risk that higher rates could weigh on housing and emphasized selection discipline: "You want to be looking bond by bond and sort of sector by sector to see where the macro and you have to do the bottom up as well to make sure that companies are not over levered."
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BondBloxx co-founder Joanna Gallegos sees historically attractive yields and is nudging investors to consider adding corporate debt. In the same interview, she said it's "really in the investor's best interest to start looking at the income that's back in fixed income" because it "can offset the volatility in your portfolio." Part of her pitch is that base rates are high and stable, while "the fundamentals of these corporations are so strong, and the economy continues to grow," which she believes is being overshadowed by the focus on Treasury rates. BondBloxx's lineup of bond ETFs covers areas such as Treasurys, corporates, private credit, and emerging-market debt. One example: the BondBloxx Private Credit CLO ETF (PCMM); FactSet shows it at a 0.6% decline year-to-date as of Friday's close.
The through-line here is simple: yields are up, quality credit is paying, and bonds can play a steadier role if your portfolio rode the AI surge. Misra is positioning around a mix of investment grade, selective high yield where spreads have widened, and a bit more duration as the rate cycle matures. Gallegos points to sturdy corporate fundamentals and a growing economy as tailwinds for income that can smooth out bumpy markets. If your risk has piled up in one corner, today's bond market is offering a way to spread it out without taking a big step down in credit quality.
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