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Best Performing Fixed Income ETFs of 2024: Total Returns, Income Potential & Volatility

January 17, 2025

Fixed-income ETFs gained significant traction among investors, with the Federal Reserve shifting to a dovish regime in 2024 and the Bloomberg US Aggregate Index delivering a modest 1.25% total return. This heightened interest in income-generating strategies contributed to the broader ETF market’s record-breaking $1 trillion in inflows.

Of the 477 fixed-income ETFs with at least a 1-year track record, 79.7% outperformed the Bloomberg US Aggregate Index, a stark contrast to the equity market, where only 13.8% of ETFs surpassed their primary benchmark. This highlights the breadth of opportunity and relative benchmark-beating potential within the fixed-income asset class.

Scatterplot showing the performance of fixed-income ETFs in 2024 compared to the Bloomberg US Aggregate Index. Green dots represent 477 ETFs that outperformed the index (1.25% total return), and red dots represent 92 underperforming ETFs. Monthly standard deviation is plotted along the x-axis, and total return is on the y-axis.

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Below, we analyzed the top-performing fixed-income ETFs based on total and NAV returns within their respective peer groups. We also offer financial advisors valuable insights into how these funds balance income potential and risk, emphasizing the trade-offs between distribution yield and volatility to support more informed portfolio decisions.

If this analysis and these visuals caught your attention but you’re more focused on equity strategies, we also reviewed the best-performing equity ETFs of 2024. Check it out here.

*Flexible Income ETFs were excluded from the analysis due to having more varied asset allocations compared to other fixed-income peer groups.*

Best Performing Fixed Income ETFs

The FolioBeyond Alternative Income and Interest Rate Hedged ETF (RISR) was the top-performing fixed-income ETF of 2024, delivering a total return of 24.2%. RISR was followed by the Virtus Stone Harbor Emerging Markets High Yield Bond ETF (VEMY), which achieved a total return of 13.5%, and the Global X Interest Rate Hedge ETF (RATE), which posted a total return of 13.4%.

The chart below provides a comprehensive view of both NAV and total returns, highlighting the dual drivers of fixed-income performance: price appreciation and income potential. View and modify the full top-ten screen here.

Line chart showcasing the top-performing fixed-income ETFs of 2024. Highlighted funds include FolioBeyond Alternative Income and Interest Rate Hedged ETF (RISR) with a 24.15% return, Virtus Stone Harbor Emerging Markets HY Bond ETF (VEMY) with 13.46%, and Global X Interest Rate Hedge ETF (RATE) with 13.43%. NAV and total return comparisons for other funds are also shown.

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The Janus Henderson B-BBB CLO ETF (JBBB) was among the least volatile top-performing strategies, with a monthly standard deviation of 0.53% and a distribution yield of 7.7%. Regarding income potential, the BondBloxx CCC Rated USD High Yield Corp Bond ETF (XCCC) delivered a 10.7% distribution yield, while VEMY closely followed with a 10.2% yield.

Scatterplot comparing distribution yield and monthly standard deviation for top-performing fixed-income ETFs. Key funds include VEMY with a 10.21% yield, BondBloxx CCC Rated USD High Yield Corp Bond ETF (XCCC) with a 10.69% yield, and RISR with a 5.56% yield.

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Best Performing Active Fixed Income ETFs

Active fixed-income ETFs significantly contributed to the increased adoption of active ETFs in portfolios throughout 2024. This can largely be attributed to the ability of skilled and experienced fund managers to identify and capitalize on inefficiencies in the fixed-income market. Also, advisors may increasingly turn to fixed-income managers to tactically and often tax-efficiently reposition client portfolios, leveraging the ETF wrapper.

The volatile rate environment in 2024 further emphasized the importance of thoughtful rebalancing and reconstitution of the fixed-income sleeves within client portfolios. For instance, the 10-year Treasury Rate fluctuated considerably, peaking at 4.7% in April and hitting a low of 3.63% in September—a variance of 107 basis points. This followed an even more significant variance of 168 basis points in 2023 when the 10-year ranged from a high of 4.98% to a low of 3.3%.

In 2024, among active U.S.-domiciled fixed-income ETFs with at least a one-year track record (excluding flexible income strategies due to their diverse asset allocations), 237 funds—or 83.8%—outperformed the Bloomberg U.S. Aggregate Index’s 1.25% total return. This starkly contrasts equity strategies, where only 16.9% of funds outperformed the asset class benchmark, highlighting the relative strength of active management in fixed income during the year.

Scatterplot showing the performance of 237 active fixed-income ETFs in 2024 relative to the Bloomberg US Aggregate Index. Green dots represent ETFs that outperformed the index, and red dots represent those that underperformed.

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The top-performing active fixed income ETFs of 2024 were RISR, VEMY, and RATE, delivering returns of 24.2%, 13.5%, and 13.4, respectively. Review and modify the full top ten screen here.

Line chart tracking total returns for the top active fixed-income ETFs in 2024, including RISR with 24.15%, VEMY with 13.46%, and RATE with 13.43%. Monthly performance fluctuations are depicted for comparison.

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The Pacer Pacific Asset Floating Rate High Income ETF (FLRT) was the least volatile among the top-performing active fixed income strategies, with a monthly standard deviation of 0.25% while maintaining a distribution yield of 7.9%.

VEMY led the group with the highest distribution yield at 10.2%. The KraneShares Asia Pacific High Income USD Bond ETF (KHYB) offered the second-highest distribution yield at 10.1%. The Panagram BBB-B CLO ETF (CLOZ) rounded out the top three with a 9.1% yield.

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Best Performing Core Bond ETFs

The best-performing core bond ETFs of 2024 were the iShares 5-10 Year Investment Grade Corporate Bond ETF (IGIB), the JPMorgan Active Bond ETF (JBND), and the iShares Intermediate Government/Credit Bond ETF (GVI), delivering returns of 3.5%, 3.2%, and 2.9%, respectively. View and modify the full top-ten screen here.

Line chart illustrating total returns for top core bond ETFs in 2024. Notable performers include iShares 5-10 Year Investment Grade Corporate Bond ETF (IGIB) with 3.49%, JPMorgan Active Bond ETF (JBND) with 3.19%, and iShares Intermediate Govt/Credit Bond ETF (GVI) with 2.92%.

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The ClearShares Piton Intermediate Fixed Income ETF (PIFI) stood out as the least volatile among the top-performing core bond strategies, with a monthly standard deviation of just 0.98% while maintaining a distribution yield of 2.9%.

The First Trust Core Investment Grade ETF (FTCB) led the group with the highest distribution yield at 5.2%. JBND delivered a 4.6% yield, followed closely by the Vanguard Total Corporate Bond ETF (VTC) at 4.5%.

Scatterplot comparing distribution yields and monthly standard deviations for core bond ETFs. Key funds include IGIB with a 4.46% yield, FTC Investment Grade Bond ETF (FTCB) with 5.25%, and ClearShares Piton Intermediate Fixed Income ETF (PIFI) with 2.93%.

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Best Performing Core Plus Bond ETFs

The best-performing core plus bond ETFs of 2024 were the NYLI MacKay Core Plus Bond ETF (CPLB), the Invesco Investment Grade Defensive ETF (IIGD), and the American Century Diversified Corporate Bond ETF (KORP), delivering returns of 4.2%, 3.9%, and 3.8%, respectively. View and modify the full top-ten screen here.

Line chart showing total returns for core plus bond ETFs in 2024, including NYLI MacKay Core Plus Bond ETF (CPLB) with 4.18%, Invesco Investment Grade Defensive ETF (IIGD) with 3.90%, and American Century Diversified Corporate Bond ETF (KORP) with 3.81%.

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IIGD emerged as the least volatile among the top-performing core bond plus strategies, boasting a monthly standard deviation of 0.9% while delivering a distribution yield of 4.1%.

CPLB led the group with the highest distribution yield at 5.4%, followed closely by the JPMorgan Core Plus Bond ETF (JCPB) at 5.2%. The iShares Investment Grade Systematic Bond ETF (IGEB) rounded out the top three, offering a distribution yield of 5.1%.

Scatterplot comparing distribution yields and monthly standard deviations for core plus bond ETFs. Key funds include CPLB with a 5.41% yield, IIGD with 4.13%, and American Century KORP with 5.14%. Performance metrics offer insights into income and risk.

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Best Performing General Bond ETFs

The best-performing general bond ETFs of 2024 were the Touchstone Strategic Income ETF (SIO), the Simplify Opportunistic Income ETF (CRDT), and the Sound Enhanced Fixed Income ETF (FXED), delivering returns of 6.2%, 5.2%, and 5.2%, respectively. View and modify the full top-ten screen here.

This line chart compares the total returns of the top-performing general bond ETFs in 2024, including the Touchstone Strategic Income ETF (SIO) with a 6.15% return, Simplify Opportunistic Income ETF (CRDT) with 5.18%, and Sound Enhanced Fixed Income ETF (FXED) with 5.17%. The chart also includes the Bloomberg US Aggregate Index (BBUSATR) as a benchmark at 1.25%. A second graph below shows changes in net asset value (NAV) for the same funds. SIO leads NAV changes with a 0.62% increase, while CRDT shows a -2.43% decline.

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CRDT stood out as the least volatile of the top-performing general bond strategies, with a monthly standard deviation of just 0.96%. It also delivered the highest distribution yield of the best-performing general bond ETFs, at 7.3%.

FXED offered the second-highest distribution yield at 6.7%, while the F/m Opportunistic Income ETF (XFIX) rounded out the top three with a 5.5% yield.

A scatterplot showing the relationship between distribution yield and standard deviation for general bond ETFs. The Simplify Opportunistic Income ETF (CRDT) has the highest distribution yield at 7.26% and a monthly standard deviation of 0.96%. Other ETFs shown include the Touchstone Strategic Income ETF (SIO) with a 5.32% yield and 1.22% standard deviation, and the Sound Enhanced Fixed Income ETF (FXED) with a 6.75% yield and 1.53% standard deviation.

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Best Performing General U.S. Treasury ETFs

The best-performing general U.S treasury bond ETFs of 2024 were the SoFi Enhanced Yield ETF (THTA), the Simplify Treasury Option Income ETF (BUCK), and the Nicholas Fixed Income Alternative ETF (FIAX), delivering returns of 7.3%, 7.3%, and 4.7%, respectively. View and modify the full top-ten screen here.

This line chart highlights total returns for U.S. Treasury bond ETFs in 2024, such as the SoFi Enhanced Yield ETF (THTA) at 7.32% and Simplify Treasury Option Income ETF (BUCK) at 7.25%. The Bloomberg US Aggregate Index is also included at 1.25% as a benchmark. The lower section shows NAV changes, with THTA experiencing a -5.03% change and BUCK showing -1.77%.

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The iShares iBonds Dec 2025 Term Treasury ETF (IBTF) was the least volatile among the top-performing general U.S. Treasury bond strategies, with a monthly standard deviation of just 0.23% while offering a distribution yield of 4.3%.

Regarding income potential in this peer group, THTA led the way among top-performing general U.S. Treasury bond ETFs with a 12.4% distribution yield, followed by BUCK at 8.9% and FIAX at 8.1%.

A scatterplot displaying distribution yield versus standard deviation for U.S. Treasury bond ETFs. The SoFi Enhanced Yield ETF (THTA) leads with a 12.43% yield and 2.14% monthly standard deviation. Other funds include the Simplify Treasury Option Income ETF (BUCK) with an 8.86% yield and 0.69% standard deviation and the Nicholas Fixed Income Alternative ETF (FIAX) with an 8.19% yield.

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Best Performing High Yield ETFs

The best-performing high yield bond ETFs of 2024 were the BondBloxx CCC Rated USD High Yield Corporate Bond ETF (XCCC), the Xtrackers High Beta High Yield Bond ETF (HYUP), and the BondBloxx USD HY Bond Healthcare Sector ETF (XHYH), which delivered returns of 13%, 10.3%, and 9.6%, respectively. View and modify the full top-ten screen here.

A line chart showing total returns for high-yield bond ETFs in 2024. The BondBloxx CCC Rated USD High Yield Corporate Bond ETF (XCCC) leads with a 13.02% return, followed by the Xtrackers High Beta High Yield Bond ETF (HYUP) at 10.29%. The Bloomberg US Aggregate Index and Bloomberg US Corporate High Yield Index are included as benchmarks with returns of 1.25% and 8.19%, respectively.

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The Invesco BulletShares 2024 High Yield Corporate Bond ETF (BSJO) was the least volatile among the top-performing high yield bond strategies, with a monthly standard deviation of just 0.24%. According to Invesco’s website, the ETF has a “distribution rate” of 5.5%.

In terms of income potential in this peer group, XCCC led the way among top-performing high yield bond ETFs with a 10.7% distribution yield, followed by the SPDR Blackstone High Income ETF (HYBL) at 7.9% and HYUP at 7.7%.

A scatterplot examining distribution yield and standard deviation for high-yield bond ETFs. The BondBloxx CCC Rated USD High Yield Corporate Bond ETF (XCCC) has the highest yield at 10.72% with a 1.53% standard deviation. Other ETFs include the Xtrackers High Beta High Yield Bond ETF (HYUP) with a 7.74% yield and 1.11% standard deviation.

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Best Performing Loan Participation ETFs

The best-performing loan participation ETFs of 2024 were the Panagram BBB-B CLO ETF (CLOZ), the Janus Henderson B-BBB CLO ETF (JBBB), and the PGIM Floating Rate Income ETF (PFRL), delivering returns of 11.9%, 10.7%, and 9.4%, respectively. View and modify the full top-ten screen here.

This line chart displays total returns for loan participation ETFs in 2024. The Panagram BBB-B CLO ETF (CLOZ) achieved the highest return at 11.85%, followed by the Janus Henderson B-BBB CLO ETF (JBBB) at 10.71%. The Bloomberg US Aggregate Index and Bloomberg US Corporate High Yield Index serve as benchmarks at 1.25% and 8.19%, respectively.

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The VanEck CLO ETF (CLOI) was the least volatile among the top-performing loan participation strategies, with a monthly standard deviation of just 0.16% while offering a distribution yield of 6.7%.

In terms of income potential in this peer group, CLOZ led the way among top-performing high yield bond ETFs with a 9.1% distribution yield, followed by PFRL at 8.9% and the SPDR Blackstone Senior Loan ETF (SRLN) at 8.6%.

A scatterplot showing yield versus standard deviation for loan participation ETFs. The Panagram BBB-B CLO ETF (CLOZ) leads with a 9.06% yield and a 0.49% standard deviation. Other ETFs include the Janus Henderson B-BBB CLO ETF (JBBB) with a 7.65% yield and a 0.53% standard deviation.

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Best Performing Emerging Markets Hard Currency ETFs

The best-performing emerging markets hard currency bond ETFs of 2024 were VEMY, the VanEck Emerging Markets High Yield Bond ETF (HYEM), and the iShares JP Morgan EM High Yield Bond ETF (EMHY), delivering returns of 13.5%, 12.2%, and 12%, respectively. View and modify the full top-ten screen here.

A line chart featuring total returns for emerging markets hard currency bond ETFs in 2024. The Virtus Stone Harbor Emerging Markets High Yield Bond ETF (VEMY) leads with a 13.46% return, followed by the VanEck Emerging Markets High Yield Bond ETF (HYEM) at 12.15%. The Bloomberg Emerging Markets USD Aggregate Index is included as a benchmark at 6.58%.

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The SPDR DoubleLine Emerging Markets Fixed Income ETF (EMTL) was the least volatile among the top-performing emerging markets hard currency bond strategies, with a monthly standard deviation of just 0.74% while offering a distribution yield of 5.3%.

Regarding income potential in this peer group, VEMY led the way among top-performing high yield bond ETFs with a 10.2% distribution yield, followed by KHYB at 10.1% and EMHY at 6.9%.

A scatterplot showing distribution yield and standard deviation for emerging markets hard currency bond ETFs. The Virtus Stone Harbor Emerging Markets High Yield Bond ETF (VEMY) has the highest yield at 10.21% with a 1.03% standard deviation. Other funds include the VanEck Emerging Markets High Yield Bond ETF (HYEM) with a 6.32% yield.

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