HYGH vs USHY

HYGHBiShares Interest Rate Hedged High Yield Bond ETF

USHYAiShares Broad USD High Yield Corporate Bond ETF

In short

HYGH High yield income with the rate risk engineered out: it owns iShares' flagship junk bond ETF and layers short interest rate swaps on top, leaving credit spreads as the main driver. A pure spread play, running since 2014.

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

HYGH The Fund seeks to track an index combining high-yield corporate-bond exposure with interest-rate hedges intended to reduce sensitivity to rising rates.

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

Why people hold it

• HYGH Owns iShares' flagship high yield corporate bond ETF and layers short interest rate swaps on top, rebalanced daily, so Treasury yield moves are largely netted out.ishares.comishares.com 2
• The index uses up to 10 swap contracts across different maturities, designed to benefit when the floating reference rate rises above the fixed rate paid.sec.govishares.com
• Trading since May 2014, so there is a decade-plus of live history behind the mechanism, and it pays monthly.

• 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

• HYGH Costs 0.52% net of a waiver through February 28, 2027 (1.12% gross), above the category median; plain trackers like SCYB at 0.03% and SPHY at 0.05% keep full duration.
• The hedge targets rates, not credit. Defaults and spread widening in below investment grade bonds still flow straight through.ishares.com
• Income nets the underlying fund's yield against fees and the cost of carry on the hedges, so the payout can differ from unhedged high yield.ishares.com

• 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 HYGH profile⁠

Full USHY profile⁠