Emerging markets income and municipal bonds show strong returns amid steady high-yield corporate defaults.

Emerging markets income investments are performing well, while municipal bonds are beginning to recover. High-yield municipal bond funds and ETFs tend to have longer durations compared to corporate bond funds, which investors should consider. Despite this, default rates for high-yield corporate credit remain stable at around 2.5-2.7% annually, indicating steady risk levels. These trends highlight potential opportunities for investors looking beyond crowded markets.