Even though stocks have performed well lately, the bond market has performed horribly over the past month, with interest rates on the rise and prices falling. The iShares Core Bond Market ETF (NYSEMKT:AGG) has lost 2% of its value in just the past month, and other bond ETFs have done even worse. But one part of the bond market has done exactly what it was designed to do: hold up well even in a rising-rate environment.
In the following video, Fool markets analyst Mike Klesta talks with Fool contributor Dan Caplinger about this special bond investment and why it has outperformed its peers lately. As Dan explains, unique features on these types of bonds make them resistant to interest rate changes, and investors actually benefit when rates rise. Dan concludes by sharing three ways you can invest in these bonds.(NYSEMKT:FLTR)