Deutsche Asset Management announced the addition of three Xtrackers exchange-traded funds (ETFs) to its high yield suite – Xtrackers Short Duration High Yield Corporate Bond ETF (SHYL), Xtrackers High Beta High Yield Bond ETF (HYUP) and Xtrackers Low Beta High Yield Bond ETF (HYDW).
The three new products will provide investors with exposure to different levels of credit and interest rate risk for more customizable risk allocation in their portfolios.
HYUP offers investors access to lower credit quality, higher beta bonds, while HYDW provides access to lower beta bonds. Through SHYL, investors will have benchmark exposure to short-duration high-yield bonds.
“In today’s low-interest rate environment, fixed income investors are looking for new sources of yield,” said Fiona Bassett, head of passive asset management, in a statement. “Our expanded Xtrackers suite of high-yield bond ETFs uses rules-based strategies to provide exposure to different levels of credit and interest rate risk, allowing investors to manage credit and duration exposure for a more customized solution.”
SHYL seeks to track the performance, before fees and expenses, of the Solactive USD High Yield Corporates Total Market 0-5 Year Index. HYUP seeks to track the performance, before fees and expenses, of the Solactive USD High Yield Corporates Total Market High Beta Index. HYDW seeks to track the performance, before fees and expenses, of the Solactive USD High Yield Corporates Total Market Low Beta Index.
Solactive Expands Family of USD High-Yield Corporates Indexes
Solactive is adding three new indexes to its family of high-yield corporate bond indexes, which have been developed as the basis of those three new Xtrackers ETFs.
The three indexes are the Solactive USD High Yield Corporates Total Market 0-5 Year Index (SOLHYCST), the Solactive USD High Yield Corporates Total Market Low Beta Index (SOLHYCLB), and the Solactive USD High Yield Corporates Total Market High Beta Index (SOLHYCHB).
Each index aims to offer exposure to different segments of the high yield corporate bond market denominated in U.S. dollars.
The first index, SOLHYCST, tracks the performance of short-duration high-yield bonds with term to maturity of maximum five years. Instead, SOLHYCHB mirrors the performance of lower credit quality higher-beta bonds, while SOLHYCLB of lower-beta bonds, with beta representing a bond’s level of volatility, and higher/lower beta generally corresponding to higher/lower yield.
The indexes are respectively tracked by new Xtrackers ETFs – SHYL, HYUP and HYDW.
The indexes are weighted by market capitalization with a 3% cap per issuer and are readjusted monthly.
Crossmark Global Investments Launches First Socially Responsible Covered Call Mutual Fund
Crossmark Global Investments launched the Crossmark Steward Covered Call Income Fund (SCJIX), which seeks to provide investors with dividend income and options premium income, with the potential for capital appreciation and less volatility than the broad equity market.
For the Steward Covered Call Income Fund, the portfolio management team buys a basket of stocks and writes (or sells) call options to cover the stock positions. In doing so, the strategy is intended to enhance portfolio returns in certain market conditions and reduce volatility.
As the first buy/write mutual fund in the Steward Family of Funds, the fund will apply Crossmark’s proprietary Steward Screens, which screen for widely held traditional values, excluding companies materially involved with alcohol, tobacco, gambling, life ethics, and mature content. The same screening process is applied to the five other values-based equity and fixed income funds that together constitute Crossmark’s Steward Fund suite.