Instead of following passive benchmarks designed to mirror the U.S. High Yield Corporate market, HYLD employs an actively managed approach that seeks the right mix of individual corporate bond issues and according to the issuer’s literature, “Peritus takes a value-based, active credit approach to the markets, largely foregoing new issue participation, favoring instead the secondary market where Peritus believes there is less competition and more opportunities for capital gains. Peritus de-emphasizes relative value in favor of long-term, absolute returns.” [High Yield Bond ETF Takes An Active Approach]
Investors are taking notice of HYLD’s advantages, which include a 12-month yield of 8.03%, roughly 160 basis points better than HYG’s. “Keep an eye on HYLD (Peritus High Yield), as shares outstanding grew by 5 units after some recent creates in the fund,” said ETF liquidity provider in a new research note. That could prove to be sound advice, particularly if interest rates spike.
Peritus High Yield ETF
ETF Trends editorial team contributed to this report.
Tom Lydon’s clients own HYG and JNK.