SCYB vs SHYL

SCYBASchwab High Yield Bond ETF

SHYLAXtrackers Short Duration High Yield Bond ETF

In short

SCYB Three basis points for the broad US high-yield corporate market. Schwab undercuts a category where the typical fund charges more than ten times as much, spreading the bet across roughly 1,800 bonds and paying monthly.

SHYL High yield without the long fuse: SHYL owns only junk bonds maturing inside five years, so rate swings land lighter than on the broad high yield crowd. Costs 0.20%, pays monthly.

Stated mandate

SCYB The fund follows a rules-based strategy intended to track the high-yield bond market, primarily through bonds in the Bloomberg Barclays US Corporate High Yield Total Return Index and similar derivatives.

SHYL The fund seeks to track, before fees and expenses, the Solactive USD High Yield Corporates Total Market 0-5 Year Index. It normally invests at least 80% of net assets, plus investment borrowings, in high yield bonds.

Why people hold it

• SCYB 0.03% a year against a category median of 0.40%. Even the cheap rivals sit above it: SPHY at 0.05%, USHY at 0.08%.
• Tracks the same Bloomberg US Corporate High Yield index as BKHY, which charges 0.22%. Same map, cheaper toll.
• Roughly 1,800 bonds, so no single issuer's blowup drives the outcome. Rules-based and passive, and it has hugged its index closely.
• A multi-billion-dollar fund that trades actively and pays monthly, which matters in a corner of the market where getting out cheaply is half the job.

• SHYL Every bond in the index matures within five years, which mechanically trims interest rate sensitivity versus full-maturity high yield funds.
• A 0.20% fee, well under the high yield category median, which is unusual for a fund running a specialist mandate rather than the plain broad index.
• About 800 issues spread default risk thin, and the income arrives monthly rather than quarterly.
• Running since 2018 and tracking its Solactive 0-5 year index tightly, it sits in the upper tier of its high yield peer group.

Worth knowing

• SCYB High yield means below-investment-grade credit. These bonds behave more like stocks than Treasuries when the economy sours, and the extra income is the payment for that risk.
• Launched in 2023, so it has a shorter record than rivals that have traded through more credit cycles.
• The strategy can hold derivatives alongside the bonds themselves to track the index, one layer beyond plain bond ownership.

• SHYL Short maturities damp rate moves, not credit risk. These are still below-investment-grade borrowers, and they reprice fast when spreads widen.
• Trades thinly next to broad high yield heavyweights like SPHY and USHY, so bid-ask spreads can run wider in fast markets.
• If the five-year maturity limit isn't the point for you, broad rivals like SCYB and SPHY charge a fraction of the fee.

Full SCYB profile⁠

Full SHYL profile⁠