HYLB vs HYLS

HYLBAXtrackers USD High Yield Corporate Bond ETF

HYLSCFirst Trust Tactical High Yield ETF

In short

HYLB Broad-market junk bonds at index-fund pricing: 0.05% a year, a fraction of what the typical high-yield bond ETF charges, spread across roughly 1,300 issues. Running since 2016, it pays monthly.

HYLS Most high yield ETFs buy the index and sit still. HYLS has been actively managed since 2013 and runs long and short bond positions at once, aiming at income first, appreciation second. That tactical wiring costs 0.69%, no fee waiver.

Stated mandate

HYLB The fund seeks to track, before fees and expenses, the Solactive USD High Yield Corporates Total Market Index. It uses a passive representative-sampling indexing approach.

HYLS The Fund seeks current income and secondarily capital appreciation through active management. It normally invests at least 80% of net assets in below-investment-grade or comparably rated high-yield debt securities.

Why people hold it

• HYLB 0.05% expense ratio puts it at the low end of the high-yield ETF field, matching SPHY and undercutting USHY's 0.08%. Fee drag matters most where yield is the whole point.
• Total-market mandate, not a filtered slice: roughly 1,300 bonds sampled from the Solactive USD High Yield Corporates Total Market Index.
• Tracking has been tight against its stated index, and it trades actively enough to keep spreads workable. One of the cleaner implementations in the high-yield group.
• Monthly distributions, with a live record going back to a 2016 launch (through the 2020 credit shock and the 2022 rate spike).

• HYLS The short book is the whole point: under normal conditions HYLS holds long and short bond positions at once, a lever the index trackers in this category do not have.sec.gov
• Income is the stated first job, appreciation second, with at least 80% of net assets in below-investment-grade debt and cash paid out monthly.
• Trading since 2013 and now a multi-billion-dollar portfolio of roughly 400 bonds, it is a seasoned operation rather than a recent launch.
• The portfolio matches the mandate on paper closely: a high yield book run the way the prospectus describes, with moderate day-to-day trading volume.

Worth knowing

• HYLB This is the credit-risk end of the bond market. Below-investment-grade issuers default more often, and prices can fall hard when spreads widen.
• Representative sampling means it holds a subset of the index, not every bond, so results can drift slightly from the benchmark.
• Cheap, but not the floor: SCYB runs 0.03%. HYLB is also a mid-sized fund next to the largest names in the category.

• HYLS At 0.69% with no fee waiver it sits above the category median, while index rivals like SCYB (0.03%) and USHY (0.08%) cost a sliver of that. Active management is what you pay for.
• Shorting and active positioning mean returns can diverge from the index in either direction, and below-investment-grade debt carries default risk.sec.gov
• The monthly payout is a policy, not a coupon: the amount floats with the portfolio's income and the manager's positioning.

Full HYLB profile⁠

Full HYLS profile⁠