HYLB vs YLD

HYLBAXtrackers USD High Yield Corporate Bond ETF

YLDBPrincipal Active 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.

YLD Most high yield ETFs just clone an index. YLD is the hand-built version: Principal's credit team blends junk bonds with senior floating-rate bank loans, at roughly what the average high yield ETF charges.

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.

YLD The Fund seeks long-term growth of capital through investments that include high-yield bonds and bank loans.

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).

• YLD At 0.39% it costs about the category median (0.40%), unusual pricing for a fund where humans pick the credit instead of copying an index.
• Bank loans are in the toolkit. Managers can mix junk bonds with senior floating-rate loans, Treasuries and preferreds, levers a plain index tracker doesn't pull.principalam.com
• Live since 2015 and pays monthly, so it has traded through real credit cycles rather than arriving with a backtest.
• Moderately traded, and it lands in the upper half of its high yield peer group on our review.

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.

• YLD Index rivals are far cheaper: SCYB at 0.03%, SPHY and HYLB at 0.05%, USHY at 0.08%. The active call is what you're paying up for.
• Junk credit is the whole point here. Below-investment-grade bonds and bank loans can move hard when credit spreads widen.principalam.com
• No index to check the manager against, and a book of roughly 150 positions, so results ride on the credit team's calls.principalam.com

Full HYLB profile⁠

Full YLD profile⁠