HYXF vs USHY

HYXFBiShares ESG Advanced High Yield Corporate Bond ETF

USHYAiShares Broad USD High Yield Corporate Bond ETF

In short

HYXF High yield with a filter. HYXF tracks a Bloomberg MSCI index of U.S. dollar junk bonds that screens out specified controversial business activities, then pays the income out monthly across roughly 600 issues.

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

HYXF The fund seeks high-yield fixed-income exposure and income by tracking an ESG-screened index of U.S. dollar-denominated corporate bonds, with exclusions for specified controversial business activities.

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

Why people hold it

• HYXF Screen first, yield second: it tracks the Bloomberg MSCI US High Yield Choice ESG Screened Index, excluding specified controversial business activities, and it has hugged that index closely.
• 0.35% a year comes in under the typical high yield bond fund, so the values screen doesn't carry a boutique price tag.
• Spread across roughly 600 bonds, with income paid monthly rather than quarterly.
• Among the stronger implementations in a crowded high yield field, and the data behind that read is solid.

• 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

• HYXF The screen has a price: SCYB, SPHY and HYLB deliver unscreened high yield exposure for a small fraction of 0.35%.
• A smaller fund that trades thinly next to the category heavyweights, which can mean wider spreads at the moment you trade.
• The filter changes who you lend to, not the credit risk you take: these are below-investment-grade borrowers that move with credit stress.

• 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 HYXF profile⁠

Full USHY profile⁠