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Now, this is depressing.

I was trying to put together a ladder of corporate bonds to demonstrate how you can generate extra yield by using riskier issues from the low end of the investment grade spectrum. But the best I could do while keeping a measure of diversification was an average yield of 2.6 per cent.

True, the comparable yields from laddered corporate bond ETFs are in the range of 1.1 to 1.3 per cent these days. But these exchange-traded funds typically hold mostly bonds rated AAA, AA and A, which are premium ratings. They also mix in some bonds rated BBB, which is the lowest investment grade rating. To see what adding some risk gets you, I used one online brokerage firm's bond filter to look for corporate bonds that were rated BBB or BBB (low) and matured in five years or less.

A lot of the bonds that turned up in this search were related in one way or another to real estate. I limited this bond ladder to two real estate companies – mortgage lender Equitable Group and Dream Office REIT. Using additional bonds in the real estate sector could have pushed up the yield a bit, but at a cost of over-concentration in a sector that could be vulnerable if residential or commercial real estate slumps.

Here's how the ladder looks:

- One-year: The Manitoba Telecom 6.650 per cent bond maturing May 11, 2016; yield is 1.6 per cent and the bond rating is BBB.

- Two-year: The Equitable Group Inc. 5.399 per cent bond maturing Nov. 23, 2017; yield is 2.4 per cent and the rating is BBB (low).

- Three-year: The Dream Office REIT 3.424 per cent bond maturing June 13, 2018; yield is 2.5 per cent, and the rating is BBB (low).

- Four-year: The Transcontinental 3.897 per cent bond maturing May 13, 2019; yield is 2.6 per cent and the rating is BBB (low).

- Five-year: The 5.000 per cent TransAlta bond maturing November 18, 2020; yield is 3.8 per cent and the rating is BBB.

The average yield of 2.6 per cent won't impress anyone who remembers five-year GICs at 5 per cent (back in 2007), but it's actually pretty good when seen in the context of how low rates are today. For example, a five-year Canada bond yields about 0.72 per cent these days and five-year GICs from alternative financial firms that are members of Canada Deposit Insurance Corp. top out around 2.3 per cent. All of a sudden, 2.6 per cent from a bond portfolio on the edge of the investment grade world doesn't look quite so depressing.