Voya Core Bond ETF (VCOB)

Overview

VCOB is an actively managed Exchange-Traded Fund (ETF) that aims to achieve both current income and capital appreciation for its investors. The fund primarily invests in a diverse array of investment-grade debt instruments, including corporate, government, and mortgage-related bonds. This encompasses a balanced selection of bonds from both U.S. markets and foreign issuers, which may include entities from emerging markets as well.

The investment strategy of VCOB incorporates the use of derivatives, such as options, futures, and swaps. These financial instruments are utilized primarily for hedging purposes, tactical asset allocation, or to enhance the overall returns of the portfolio. The management typically maintains a dollar-weighted average duration of the investment portfolio between 3 and 10 years, adapting this duration based on fluctuations in interest rates.

VCOB's investment process is underpinned by a combination of macroeconomic, top-down insights along with meticulous bottom-up analysis. This dual approach allows the management team to evaluate crucial factors such as sector allocation, security selection, and overall yield curve positioning. Insightful proprietary research, quantitative analytics, and scenario-based risk testing are integral to the decision-making process, with environmental, social, and governance (ESG) criteria included as a significant factor among others.

The fund is characterized by a high level of portfolio turnover, reflecting its active management approach. The investment management team frequently buys and sells holdings to optimize gains, limit potential losses, or to chase new investment opportunities.

Products and Services

• Actively Managed ETF: VCOB is designed to adapt to market conditions, allowing for strategic buying and selling of bonds to enhance returns while managing risk effectively.
• Investment-Grade Debt Investments: The fund focuses on high-quality debt instruments, including corporate bonds, government securities, and mortgage-related assets, providing a stable income source and potential growth.
• Global Diversification: VCOB invests in both U.S. and international bonds, including those from emerging markets, leveraging global opportunities for income and appreciation.
• Use of Derivatives: The fund incorporates financial derivatives such as options, futures, and swaps to manage risk, follow tactical strategies, and enhance overall returns.
• Macro and Micro Analysis: With a robust investment process that combines macroeconomic insights and detailed bottom-up analysis, VCOB assesses sectors and individual securities for optimal positioning.
• Proprietary Research and Risk Testing: The decision-making process is supported by proprietary research and quantitative analytics, ensuring well-informed choices that consider various market scenarios and risks.
• ESG Criteria Integration: Environmental, social, and governance factors are integrated into the investment decision-making process, aligning investment strategies with ethical considerations and sustainability goals.
• High Portfolio Turnover: The actively managed nature of VCOB results in frequent trading within the portfolio, allowing the management team to adapt to market changes swiftly and capitalize on new opportunities.