The top performing fixed income ETFs of 2025 are in convertible bond strategies and emerging market local currency funds. Convertible bonds offer the right to convert into stock if share price rises, resulting in lower yields. Calamos Convertible Equity Alternative ETF leads with 29.9% gain, followed by other funds up to 18.3%.

Local currency emerging market bond ETFs invest in bonds denominated in local currencies. MSCI Emerging Markets Currency Index is up 6.3% this year. These funds yield between 6% and 7%, higher than USD-based EM bond ETFs. First Trust Emerging Markets Local Currency Bond ETF leads with 21% return, while USD-denominated Invesco Emerging Markets Sovereign Debt ETF is up 16.7%.

Read more at Yahoo Finance: The Best-Performing Bond ETFs of 2025