UCTUSFA VanEck US Fallen Angel High Yield Bond UCITS ETF Please read important disclosure Close important disclosure true pl en false false
USFA

US Fallen Angels ETF
VanEck US Fallen Angel High Yield Bond UCITS ETF

USFA

US Fallen Angels ETF
VanEck US Fallen Angel High Yield Bond UCITS ETF

ISIN: IE000J6CHW80 copy-icon

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.

  • NAV
    $21.66

    as of 17 May 2024
  • YTD RETURNS
    1.20%

    as of 17 May 2024
  • Total Net Assets
    $8.4 million

    as of 17 May 2024
  • Total Expense Ratio
    0.35%
  • Inception Date
    01 Sep 2023
  • SFDR Classification
    Article 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,

KID

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,

KID

and Prospectus.



Underlying Index

ICE US Fallen Angel High Yield 10% Constrained Index

Performance

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