EUHY vs USHY

EUHYBiShares Euro High Yield Corporate Bond USD Hedged ETF

USHYAiShares Broad USD High Yield Corporate Bond ETF

In short

EUHY US junk-bond ETFs are everywhere. EUHY goes the other direction: euro-denominated European high yield, with the euro exposure hedged back to dollars. European credit risk, without the currency ride.

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

EUHY The fund seeks to track USD-hedged, euro-denominated high-yield bonds, providing euro high-yield exposure while reducing euro-to-dollar currency fluctuations.

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

Why people hold it

• EUHY Tracks the Bloomberg Pan-European High Yield (Euro) 100% Hedged to USD Index, so you hold European credit spreads with euro-to-dollar swings hedged out.
• Costs 0.35% a year, below the 0.40% median for high-yield bond ETFs.
• Spread across roughly 700 bonds, so no single issuer carries the fund.
• Trading since 2012 inside BlackRock's iShares lineup, a long run for such a narrow corner of the bond market.

• 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

• EUHY Thinly traded. Bid-ask spreads can run wider and larger orders move the price more than in the household-name high-yield funds.
• Cheap for its cohort, not for high yield generally: US-focused funds like SCYB and SPHY charge a fraction. The European mandate and the hedge cost extra.
• The hedge cuts both ways, stripping out euro gains as well as euro losses, and payouts land on an irregular schedule rather than a fixed monthly rhythm.

• 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 EUHY profile⁠

Full USHY profile⁠