FHYS vs HYEM

FHYSCFederated Hermes Short Duration High Yield ETF

HYEMBVanEck Emerging Markets High Yield Bond ETF

In short

FHYS Federated Hermes' credit desk picks this one by hand: high-yield bonds plus bank loans, duration generally kept under three years. Credit risk, dialed-down rate risk, for 0.50% net of a waiver through May 1, 2027.

HYEM Most funds in the high yield aisle buy American junk. HYEM leaves the country: a passive index of emerging markets corporate high yield, roughly 500 bonds deep, trading since 2012 and paying monthly.

Stated mandate

FHYS The Fund seeks high current income.

HYEM HYEM seeks to track, before fees and expenses, the price and yield performance of the ICE BofA Diversified High Yield US Emerging Markets Corporate Plus Index.

Why people hold it

• FHYS Actively managed against a BB-B, 0-5 year high yield benchmark, so the mandate leans to the shorter, higher-quality end of junk rather than deep CCC paper.federatedhermes.com
• Portfolio duration is generally held under three years by design, which mutes the rate swings that hit long-dated bond funds.federatedhermes.com
• The mandate allows bank loans, syndicated loans and CLOs alongside bonds, floating-rate corners most index high yield ETFs skip.
• Income arrives monthly, drawn from roughly 300 positions across below-investment-grade corporate debt.

• HYEM A specialist, not a core holding. It passively tracks an ICE BofA index of emerging markets high yield corporate bonds, a corner most funds in this cohort never touch.
• Spread thin on purpose: roughly 500 bonds, so no single issuer or borrower carries the fund.
• Running since 2012 and paying monthly, with a 0.40% fee that lands right at the median for high yield bond ETFs.
• Lands in the upper half of a crowded high yield field, helped by its broad bond lineup and how smoothly it trades.

Worth knowing

• FHYS At 0.50% net of a waiver through May 1, 2027 (0.61% gross) it prices above the category median; peer SYFI charges 0.40% and HYDB 0.35%, neither waived.
• Small and lightly traded next to the category's heavyweights, so spreads can be wider. Limit orders earn their keep here.
• Short duration trims rate sensitivity, not credit risk; below-investment-grade issuers can still default or reprice quickly.

• HYEM That 0.40% is median for the category but many times what plain US junk funds charge (SCYB at 0.03%, SPHY at 0.05%). The fee buys the emerging markets mandate, not broad high yield beta.
• Emerging markets credit stacks country and political risk on top of ordinary default risk, so it can behave quite differently from US high yield.
• Moderately traded rather than a giant of the aisle, so limit orders and size discipline matter more here than in the mega-funds.

Full FHYS profile⁠

Full HYEM profile⁠