Muni bond funds were up anywhere for 5-8% at their highs, but buckled in the past few months. Muni bonds ETFs are now among the worst-performing fixed-income products of the year, including the VanEck Vectors AMT-Free Intermediate Municipal Index ETF (ITM), down 1.9%; the Deutsche X-trackers Municipal Infrastructure Revenue Bond ETF (RVNU), down 1.5%; and the VanEck Vectors High-Yield Municipal Index ETF (HYD), down 1.3%.
YTD Returns For ITM, RVNU, HYD
Meanwhile, overseas fixed-income products haven't been immune from this year's volatility. The ProShares German Sovereign/Sub Sovereign ETF (GGOV) shed 1.2% year-to-date, making it the 10th-worst-performing fixed-income exchange-traded fund of the year.
Two China ETFs did even worse. The VanEck Vectors ChinaAMC China Bond ETF (CBON) and the KraneShares E Fund China Commercial Paper ETF (KCNY) lost 5.6% and 4.9%, respectively, making them this year's two worst-performing fixed-income ETFs.
“The [Chinese] bond market is overwhelmed by negative news from all sides, including surging U.S. Treasury yields, continuing regulatory tightening and rising inflation with improved economic fundamentals,” explained a Shanghai-based trader.