CLOB vs USHY

CLOBDVanEck AA-BB CLO ETF

USHYAiShares Broad USD High Yield Corporate Bond ETF

In short

CLOB Most bond funds buy the loans. CLOB buys the machinery that repackages them: AA-through-BB slices of collateralized loan obligations, picked by an active team rather than an index, with income paid monthly.

USHY The wide-angle lens on junk bonds: about 1,900 US dollar high yield corporate issues for 0.08% a year, a fifth of what the typical fund in its category charges. Broad, cheap, heavily traded, and it pays monthly.

Stated mandate

CLOB The fund is actively managed and seeks capital preservation and current income. It invests primarily in AA to BB rated tranches of collateralized loan obligations of any maturity.

USHY The fund seeks to track an index of U.S. dollar-denominated high yield corporate bonds.

Why people hold it

• CLOB Narrow, legible mandate: AA to BB rated CLO tranches, the mezzanine middle of the stack rather than the senior top, with capital preservation and current income as the stated goals.
• Actively run, not index-cloned, but measured against a public yardstick (the JP Morgan CLOIE Balanced Mezzanine Index), so you can see what the managers are being judged on.
• Distributions land monthly, and the book stays compact at roughly 60 positions, so each tranche the team picks actually shows up in the result.

• USHY Charges 0.08% a year while the median high yield fund in its cohort runs 0.40%. Cheap rent on an expensive-to-run corner of the bond market.
• Holds about 1,900 bonds against the ICE BofA US High Yield Constrained Index: the broad market, not a curated slice of the most liquid names.ishares.com
• A multi-billion-dollar fund and one of the more actively traded in high yield, which tends to keep bid-ask spreads thin even on busy days.
• Pays monthly and has tracked its index tightly since its 2017 launch, one of the closer index matches in its peer group.

Worth knowing

• CLOB 0.45% a year sits above the typical high-yield bond ETF, where plain corporate-credit index funds like SCYB (0.03%) and SPHY (0.05%) live. Different job, different sticker.
• It gets shelved with high-yield bond funds, but structured CLO tranches are a different animal from corporate bonds. Side-by-side peer comparisons do not map cleanly.
• Launched in 2024 and thinly traded, so the track record is short and bid-ask spreads can widen when the tape gets quiet.

• USHY High yield means below-investment-grade borrowers. When credit gets stressed this asset class drops with stocks instead of cushioning them.
• Cheaper tickets sit on the same shelf: SCYB at 0.03% and SPHY at 0.05%.
• This is a fund, not a bond ladder. No maturity date hands your principal back; the basket rolls on indefinitely.

Full CLOB profile⁠

Full USHY profile⁠