USHY vs VSHY

USHYAiShares Broad USD High Yield Corporate Bond ETF

VSHYBVirtus Newfleet Short Duration High Yield Bond ETF

In short

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.

VSHY Junk bonds without the long fuse. VSHY runs an active high yield portfolio with duration held to one to three years, so rate swings land lighter than on full-length index rivals.

Stated mandate

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

VSHY The Fund seeks a high level of current income and, secondarily, capital appreciation.

Why people hold it

• 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.

• VSHY The mandate is the point: managers target a one to three year duration, taking high yield credit risk without full-length interest rate exposure.virtus.com
• Actively run, not index-bound. Newfleet's team buys on relative value and can add floating rate bank loans instead of owning whatever an index dictates.virtus.com
• A 0.39% fee sits near the middle of the high yield ETF pack, unusual for active bond management.
• Pays monthly, spreads credit across roughly 200 positions, and has been trading since 2016.

Worth knowing

• 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.

• VSHY Small fund, thin volume. The bid-ask spread can matter more to your cost here than the expense ratio does.
• Index giants cost far less: SCYB, SPHY and USHY all charge under a tenth of a percent for broad high yield.
• Short duration softens rate moves, not default risk. These are below-investment-grade bonds, and the fund may reach into emerging markets and bank loans.virtus.com

Full USHY profile⁠

Full VSHY profile⁠