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Investors digging for yield can still find it in these corporate bond funds

American flags hang from the facade of the New York Stock Exchange (NYSE) building in New York January 28, 2021.

Mike Segar | Reuters

Investors looking for yield can still find it in corporate bonds, but they need to navigate carefully as interest rates rise.

One of the simplest ways to invest in these bonds is through exchange-traded funds, which offer a wide selection with varying levels of risk.

ETFs for investment-grade U.S. corporate bonds – those believed to have a lower risk of default – are currently yielding well above 3%.

High-yield bond funds, which are riskier and have lower ratings from credit rating agencies, are yielding more than 4.5%.

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