HYFI Profile
The Ab Active ETFs Inc. - High Yield ETF Fund is designed to provide investors with exposure to a diversified portfolio of high-yield, or "junk," bonds. The fund aims to invest at least 80% of its net assets in fixed-income securities that are rated Ba1 or lower by Moodys Investors Service, BB+ or lower by S&P Global Ratings, or Fitch Ratings, or their equivalent ratings from other nationally recognized statistical rating organizations (NRSROs). These lower-rated securities typically offer higher yields compared to investment-grade bonds, reflecting their higher risk profiles.
The fund focuses on securities with lower credit ratings, which are often associated with higher yields due to the increased risk of default. In addition to rated securities, the fund may also invest in unrated bonds that the Adviser deems to be of comparable quality to the rated securities. This strategy allows the fund to capture a broader range of high-yield investment opportunities, potentially enhancing returns for investors willing to accept higher levels of credit risk.
The investment strategy of the High Yield ETF Fund includes the use of related derivatives to manage risk and enhance returns. These derivatives may be employed to hedge against interest rate changes, credit risk, or to leverage the fund's exposure to high-yield securities. The use of derivatives is intended to provide additional flexibility and opportunities to achieve the funds investment objectives, while also managing potential risks associated with high-yield investments.
As a high-yield fund, it targets investors who are seeking higher income potential and are comfortable with the increased risk associated with lower-rated bonds. The funds investment in a wide array of high-yield securities, combined with strategic use of derivatives, aims to deliver attractive returns while managing the inherent risks of the high-yield bond market. The Ab Active ETFs Inc. - High Yield ETF Fund offers a specialized approach to fixed-income investing, catering to those looking for enhanced yield and willing to navigate the volatility and credit risk of lower-rated bonds.
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