iShares Broad USD High Yield Corporate Bond ETF (USHY)
CXA 
Summary
How This High Yield Fund Keeps Paying Through Economic Uncertainty
iShares Broad USD High Yield Corporate Bond ETF (NYSEARCA:USHY) is one of the cheapest ways to access a junk-bond income stream, paying monthly distributions with a trailing yield close to 6.9% at recent prices.
USHY Investors: Watch This 350 Basis Point Trigger Over the Next 12 Months
The iShares Broad USD High Yield Corporate Bond ETF (NYSEARCA:USHY) has quietly become the cheapest mainstream way to own US high-yield credit, with a net expense ratio of just 0.08% as of the latest fact sheet.
USHY: 7.33% On Paper, 6.6% In Reality
The iShares Broad USD High Yield Corporate Bond ETF boasts $26.7B AUM and headline yields above 7%, but deeper analysis reveals lower effective yields. USHY's portfolio is dominated by BB and B-rated bonds, with a median yield to maturity of 6.54%, notably below the weighted average YTM. Over 63% of USHY's holdings yield less than 7%; high-yield outliers (>10% YTM) represent only 6.61% of the portfolio by weight.
iShares Broad USD High Yield Corporate Bond ETF (USHY) FAQ
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iShares Broad USD High Yield Corporate Bond ETF Profile
| CXA Exchange | US Country |
Overview
This fund is designed to offer investors exposure to the U.S. dollar-denominated high yield corporate bond market by investing a substantial portion of its assets in the securities that constitute its underlying index. The fund aims to closely track the performance of this index through strategic asset allocation, with at least 80% of its assets invested in the index's component securities and a minimum of 90% of its assets invested in fixed income securities similar to those included in the index. Managed by BFA, the fund seeks to mirror the index's broad representation of the high yield corporate bond market, focusing on securities that BFA believes will help achieve this goal.
Products and Services
The fund's primary commitment lies in offering investors defined exposure and engagement with the high yield corporate bond market through carefully selected securities. Below are the key products and services offered:
- Component Securities Investment:
Following its strategy, the fund invests at least 80% of its total assets in the component securities of its underlying index. This approach ensures that the fund's performance closely aligns with the performance of the underlying index, offering investors consistency and reliability in returns relative to the high yield corporate bond market.
- Fixed Income Securities Investment:
With a commitment to invest at least 90% of its assets in fixed income securities of the types included in the underlying index, the fund focuses on securing assets that support its objective of tracking the underlying index. These securities are selected based on BFA's analysis and belief that they will contribute to the fund's alignment with the index's performance, providing a broad representation of the U.S. dollar-denominated high yield corporate bond market.
