US Fallen Angels ETF
VanEck US Fallen Angel High Yield Bond UCITS ETF
US Fallen Angels ETF
VanEck US Fallen Angel High Yield Bond UCITS ETF
Fund Description
VanEck currently manages the largest ETF fallen angels strategy in the world. VanEck US Fallen Angel High Yield Bond UCITS ETF offers access to corporate bonds initially issued with investment grade status and then downgraded to high yield. The bonds need to be US dollar denominated and issued in the US domestic market, by both US and non US issuers from developed countries. The strategy presents a strong track record and an interesting investment case, characterized by the following main points.
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NAV$22.45
as of 01 Nov 2024 -
YTD RETURNS4.88%
as of 01 Nov 2024 -
Total Net Assets$24.0 million
as of 01 Nov 2024 -
Total Expense Ratio0.35%
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Inception Date01 Sep 2023
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SFDR ClassificationArticle 6
Overview
Fund Description
VanEck currently manages the largest ETF fallen angels strategy in the world. VanEck US Fallen Angel High Yield Bond UCITS ETF offers access to corporate bonds initially issued with investment grade status and then downgraded to high yield. The bonds need to be US dollar denominated and issued in the US domestic market, by both US and non US issuers from developed countries. The strategy presents a strong track record and an interesting investment case, characterized by the following main points:
- Timing: corporate bonds are included when the downgrade to High Yield takes place, with historical evidence pointing to a subsequent price recovery.
- Contrarian Approach: by investing in downgraded bonds often an exposure to sectors undergoing turmoil is achieved. Examples include the financial sector in the aftermath of the GFC or the energy sector in 2016.
- Potentially oversold market dynamic: many institutional investors are forced by their mandates to own only investment grade securities, which could cause excessive selling pressure on the securities when the downgrade takes place.
- Rising stars: fallen angel bonds tend to display a higher tendency to regain investment grade status, when compared to the broad high yield spectrum.
1Past performance is not a reliable indicator for future performance. Risk factors: You may lose money up to the total loss of your investment due to the Risk of Investing in high yield securities, Credit Risk and Interest Rate Risk as described in the Main Risk Factors,
and Prospectus.
Underlying Index
ICE US Fallen Angel High Yield 10% Constrained Index
Fund Highlights
- Timing: corporate bonds are included when the downgrade to High Yield takes place, with historical evidence pointing to a subsequent price recovery.
- Contrarian Approach: by investing in downgraded bonds often an exposure to sectors undergoing turmoil is achieved. Examples include the financial sector in the aftermath of the GFC or the energy sector in 2016.
- Potentially oversold market dynamic: many institutional investors are forced by their mandates to own only investment grade securities, which could cause excessive selling pressure on the securities when the downgrade takes place.
- Rising stars: fallen angel bonds tend to display a higher tendency to regain investment grade status, when compared to the broad high yield spectrum.
1Past performance is not a reliable indicator for future performance. Risk factors: You may lose money up to the total loss of your investment due to the Risk of Investing in high yield securities, Credit Risk and Interest Rate Risk as described in the Main Risk Factors,
and Prospectus.
Underlying Index
ICE US Fallen Angel High Yield 10% Constrained Index
Capital Markets
VanEck partners with esteemed market makers to ensure the availability of our products for trading on the mentioned stock exchanges. Our Capital Markets team is committed to continuously monitoring and assessing spreads, sizes, and prices to ensure optimal trading conditions for our clients. Furthermore, VanEck ETFs are available on various trading platforms, and we collaborate with a wider range of reputable Authorized Participants (APs) to promote an efficient and fair trading environment. For more information about our APs and to contact our Capital Markets team, please visit factsheet capital markets.pdfPerformance
Holdings
Portfolio
Literature
Index
Index Description
ICE US Fallen Angel High Yield 10% Constrained Index tracks the performance of US dollar denominated below investment grade corporate debt publicly issued in the US domestic market and that were rated investment grade at the point of issuance.
Index Key Points
Underlying Index
ICE US Fallen Angel High Yield 10% Constrained Index
Index Composition
ICE US Fallen Angel High Yield 10% Constrained Index selects high yield corporate bonds that were issued with investment grade rating. The securities need to be US dollar denominated and issued in the US domestic market. The index employs a market capitalization weighting scheme.
- Single issuers weightings are capped at 10%
- Eligible securities must have a below investment grade status but have been originally issued with an investment grade rating
- Eligible securities must have at least 18 months to maturity at the time of issuance and at least one year to maturity as of the rebalancing date
- Minimum amount outstanding of $250 million
Index Provider
ICE Data Indices, LLC
For more information about the index please click here