Fixed income ETF specialist BondBloxx Investment Management has launched its first product suite of seven ETFs.
The fixed income funds, which are on NYSE Arca, are designed to offer precise, index-based exposure to the high yield asset class and allow investors the opportunity to diversify and manage risk to industry sector.
“Until today, fixed income investors could not execute sector-specific views in high yield bonds through ETFs. We are excited to bring the ETF benefits of efficiency, transparency, and liquidity to fixed income investors with first-to-market products that enable what we believe is a more precise portfolio construction,” says BondBloxx founder Leland Clemons.
The funds are passively managed and track rules-based sub-indices of the ICE BofA US Cash Pay High Yield Constrained Index.
The first product is the BondBloxx US High Yield Energy Sector ETF, with the ticker XHYE, investing in the energy sector including the exploration & production, gas distribution, oil field equipment & services, and oil refining & marketing sub-sectors.
The second is the BondBloxx US High Yield Industrial Sector ETF, ticker: XHYI, investing in basic materials, capital goods, transportation and services sub-sectors.
The third is the BondBloxx US High Yield Financial and REIT Sector ETF with the ticker: XHYF investing in banking, financial services, insurance, and REIT sub-sectors.
The fourth ETF is the BondBloxx US High Yield Telecom Media & Technology Sector ETF, with the ticker: XHYT, which invests in telecom, media and technology sector, including the telecommunications, communication services, technology & electronics, and media sub-sectors.
Fifth is the BondBloxx US High Yield Healthcare Sector ETF, with the ticker: XHYH investing in the healthcare sector, including the health facilities, health services, managed care, medical products, and pharmaceuticals sub-sectors.
Sixt is the BondBloxx US High Yield Consumer Cyclicals Sector ETF. ticker: XHYC, investing in consumer cyclicals sector, including the automotive, leisure, real estate development & management, department stores, and specialty retail sub-sectors and the final product is the BondBloxx US High Yield Consumer Non-Cyclicals Sector ETF, with the ticker: XHYD which invests in consumer non-cyclicals sector, including the consumer goods, discount stores, food & drug retail, restaurants, and utilities sub-sectors.
BondBloxx was founded by ETF industry leaders Leland Clemons, Joanna Gallegos, Elya Schwartzman, Mark Miller, Brian O’Donnell and Tony Kelly. The team has collectively built and launched over 350 ETFs at firms including BlackRock, J.P. Morgan, State Street, Northern Trust and HSBC.
“Our conversations with investors have reinforced what we already knew – there is significant demand for more targeted fixed income products,” says BondBloxx co-founder Tony Kelly. “Our initial product suites aim to create a full toolkit for high yield investors looking to implement their specific views on the market, and we anticipate extending this approach to other fixed income asset classes.”
The funds have an annual expense ratio of 0.35 per cent. BondBloxx has filed a prospectus with the SEC with proposed details of the second set of funds.