6 Best-Performing Bond ETFs for November 2023

Bond ETFs are bundles of investments that track particular bonds and bond markets, offering easy and affordable diversification options.
Alieza Durana
By Alieza Durana 
Edited by Arielle O'Shea

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Bond exchange-traded funds, also known as bond ETFs, offer an easy and affordable way to diversify your financial portfolio, create a source of income and reduce volatility. Here’s what you need to know.

Bond ETF definition

Bond ETFs exclusively track and trade bonds, bond indexes or other fixed-income investments in various categories. When you buy a bond ETF, you're purchasing a share of the fund and receiving a portion of that fund's returns.

Biggest bond ETFs

Here are bond ETFs ranked by five-year performance. Remember, when researching a bond ETF, you'll want to also investigate its liquidity, maturity and tradability in addition to the interest rate it offers. Read more about these characteristics below.


Fund name

Five-year return


iShares Convertible Bond ETF



Invesco BulletShares 2023 Corporate Bond ETF



SPDR Bloomberg Convertible Securities ETF



Invesco BulletShares 2025 High Yield Corporate Bond ETF



iShares Fallen Angels USD Bond ETF



VanEck Fallen Angel High Yield Bond ETF


Source: VettaFi. Data is current as of November 2, 2023 and is for informational purposes only.

NerdWallet rating 


NerdWallet rating 


NerdWallet rating 





per trade for online U.S. stocks and ETFs



per trade



per trade. Other fees apply.

Account minimum 


Account minimum 


Account minimum 




no promotion available at this time



no promotion available at this time


Get up to $600 or more

when you open and fund an E*TRADE account

Advantages of bond ETFs versus individual bonds

ETFs are touted for a simple reason: easy and affordable diversification. Building out your portfolio by individually picking stocks or bonds can be risky and expensive. For instance, while a single U.S. Treasury bond sells for $100

Financial Industry Regulatory Authority (FINRA). U.S. Treasury Securities. Accessed Apr 26, 2022.
, a single municipal bond can cost a minimum of $5,000.

The minimum investment for a bond ETF, in contrast, is the share price, which can be much more affordable. For instance, on April 25, 2022, a single share of the First Trust Municipal High Income ETF, or FMHI, was $49.33. In other words, for under $50, you could buy a share of FMHI and instantly be invested in a wide spectrum of U.S. municipal bonds. Bond ETFs can be purchased through most online brokers and may contain hundreds of bonds, instantly spreading your risk across many investments.

Here are some other essential characteristics of bond ETFs:

  • Liquidity: Bond ETFs are liquid, meaning they can be bought or sold at any time without negatively impacting the price. On the other hand, individual bonds vary in how easily they can be bought and sold. Long-term treasuries, for example, are attractive for their high yields. However, they can also be less liquid than a bond ETF if you were to try and sell in a pinch.

  • Maturity: Bond ETFs maintain constant maturity. In contrast, individual bonds mature on a specific date. Since a bond ETF is a "basket" of bonds that mature at various dates, the bond ETF calculates prices by using the average maturity at any given point in time.

  • Tradability: Bond ETFs are easily tradable through any brokerage account that offers them. Some individual bonds have more complex sale processes.

How to buy bond ETFs

Ready to get started? Try the following three steps:

  1. First, if you don’t already have a brokerage account, view NerdWallet's picks for the best brokers for ETFs to find the right one for you.

  2. Compare ETFs using free screening tools (often available through your brokerage account).

  3. Weigh characteristics such as expense ratios, volume, holdings, performance and trading prices.

  4. Once you’ve found an ETF, place a trade.

» Read our primer on ETFs

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Neither the author nor editor held positions in the aforementioned investments at the time of publication.
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