STRATEGY Interest Rate Hedged
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Interest Rate Hedged
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Navigating Rising Rates with Interest Rate Hedged ETFs
Rising Rates | August 17, 2026

When interest rates go up, bond prices usually fall. For investors who still want bond exposure but are concerned about rising rates, ProShares Investment Grade - Interest Rate Hedged ETF (IGHG) and High Yield - Interest Rate Hedged ETF (HYHG) are designed to provide corporate bond exposure with a built-in hedge against rising interest rates. In this video, you'll learn how rising rates can impact bond investments and how IGHG and HYHG may help investors stay invested while addressing that challenge.

 

Video Transcript: 

The math is simple. When interest rates go up, bond prices usually fall. And that's because most bonds pay fixed coupons.

And that's been showing up in the market. From the recent low at the end of February through mid-June, the yield on the U.S. 10-year Treasury rose more than 50 basis points, while the Bloomberg U.S. Aggregate Bond Index moved into negative territory.

Now, for investors who still want bond exposure but are concerned about those rising rates, interest rate hedged ETFs may offer a more targeted approach.

ProShares Investment Grade - Interest Rate Hedged ETF, IGHG, and High Yield - Interest Rate ETF, HYHG, are designed to provide corporate bond exposure with a built-in hedge against those rising interest rates.

In a market where rates remain a key risk, IGHG and HYHG may help investors stay invested while addressing that challenge.

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Interest Rate Hedged ETFs

IGHG

Investment Grade - Interest Rate Hedged

Seeks investment results, before fees and expenses, that track the performance of the FTSE Corporate Investment Grade (Treasury Rate-Hedged) Index.

HYHG

High Yield - Interest Rate Hedged

Seeks investment results, before fees and expenses, that track the performance of the FTSE High Yield (Treasury Rate-Hedged) Index.

STRATEGY Interest Rate Hedged
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Interest Rate Hedged
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Performance quoted represents past performance and does not guarantee future results. Investment return and principal value will fluctuate so that an investor’s shares, when sold or redeemed, may be worth more or less than the original cost. Current performance may be lower or higher than the performance quoted. For standardized returns and performance data current to the most recent month end, see Performance. 

Investing involves risk, including the possible loss of principal. These ProShares ETFs are diversified and entail certain risks, including risks associated with the use of derivatives (swap agreements, futures contracts and similar instruments), imperfect benchmark correlation, leverage and market price variance, all of which can increase volatility and decrease performance. Please see summary and full prospectuses for a more complete description of risks. There is no guarantee any ProShares ETF will achieve its investment objective. 

IGHG and HYHG do not attempt to mitigate factors other than rising Treasury interest rates that impact the price and yield of corporate bonds, such as changes to the market's perceived underlying credit risk of the corporate entity. IGHG and HYHG seek to hedge investment grade bonds and high yield bonds, respectively, against the negative impact of rising rates by taking short positions in Treasury futures. The short positions are not intended to mitigate credit risk or other factors influencing the price of the bonds, which may have a greater impact than rising or falling interest rates. These positions lose value as Treasury prices increase. Investors may be better off in a long-only investment grade or high yield investment than investing in IGHG or HYHG when interest rates remain unchanged or fall, as hedging may limit potential gains or increase losses. No hedge is perfect. Because the duration hedge is reset on a monthly basis, interest rate risk can develop intra-month, and there is no guarantee the short positions will completely eliminate interest rate risk. Furthermore, while IGHG and HYHG seek to achieve an effective duration of zero, the hedges cannot fully account for changes in the shape of the Treasury interest rate (yield) curve. IGHG and HYHG may be more volatile than a long-only investment in investment grade or high yield bonds. Performance of IGHG and HYHG could be particularly poor if investment grade or high yield credit deteriorates at the same time that Treasury interest rates fall. There is no guarantee the fund will have positive returns. 

Bonds will decrease in value as interest rates rise. 

High yield bonds may involve greater levels of credit, liquidity and valuation risk than higher-rated instruments. High yield bonds are more volatile than investment grade securities, and they involve a greater risks of loss (including loss of principal) from missed payments, defaults or downgrades because of their speculative nature. 

Short positions in a security lose value as that security's price increases. 

Narrowly focused investments typically exhibit higher volatility. 

"FTSE,®" "FTSE Corporate Investment Grade (Treasury Rate-Hedged)" and "FTSE High Yield (Treasury Rate-Hedged)" have been licensed for use by ProShares. FTSE is a trademark of the London Stock Exchange Plc and The Financial Times Limited and is used by the FTSE International Limited ("FTSE") under license. ProShares have not been passed on by FTSE or its affiliates as to their legality or suitability. ProShares based on the FTSE Corporate Investment Grade (Treasury Rate-Hedged) or FTSE High Yield (Treasury Rate-Hedged) Index are not sponsored, endorsed, sold or promoted by FTSE or its affiliates, and they make no representation regarding the advisability of investing in ProShares. THIS ENTITY AND ITS AFFILIATES MAKE NO WARRANTIES AND BEAR NO LIABILITY WITH RESPECT TO PROSHARES. 

Carefully consider the investment objectives, risks, charges and expenses of ProShares before investing. This and other information can be found in their summary and full prospectuses. Read them carefully before investing.

ProShares are distributed by SEI Investments Distribution Co., which is not affiliated with the funds’ advisor or sponsor.

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