SIHY vs USHY

SIHYBHarbor Ares Systematic High Yield ETF (SIHY)

USHYAiShares Broad USD High Yield Corporate Bond ETF

In short

SIHY Most high yield ETFs just clone the index. SIHY hands the junk bond picking to a machine: Ares Systematic Credit runs a model-driven process across roughly 300 below-investment-grade bonds, and pays monthly.

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

SIHY The ETF commits at least 80% of its net assets, plus investment-purpose borrowings, to below-investment-grade corporate bonds or equivalent unrated securities; derivatives may represent those investments.

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

Why people hold it

• SIHY Genuinely active in a mostly passive corner: a proprietary, model-based framework drives bond-by-bond selection instead of index replication.harborcapital.com
• Tight mandate, real diversification: at least 80% of net assets in below-investment-grade corporate bonds or unrated equivalents, spread across roughly 300 positions.
• Live since 2021 with a monthly distribution cadence, so the strategy has a multi-year record in the market rather than a backtest.
• The portfolio has stayed closely aligned with the mandate written in its prospectus, which is not a given among active credit funds.

• 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

• SIHY Active pricing: 0.48% a year, above the 0.40% category median and many times the 0.03% and 0.05% charged by index rivals SCYB and SPHY.
• Thinly traded and small by category standards, so bid-ask spreads can be wider and large orders can move the price.
• High yield means default and downgrade risk, and a model-picked portfolio can diverge from the index in either direction.

• 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 SIHY profile⁠

Full USHY profile⁠