State Street Global Advisors, the asset management business of State Street Corporation has announced the launch of the SPDR Blackstone High Income ETF (HYBL).
Sub-advised by Blackstone Credit (“Blackstone”), HYBL is actively managed and invests in US dollar-denominated high yield debt securities seeking to provide investors with risk-adjusted returns and high current income. Blackstone is also sub-adviser of the SPDR Blackstone Senior Loan ETF (SRLN).
“We’re excited to expand on our successful partnership with Blackstone to provide investors with a new approach to income investing,” says Sue Thompson, head of SPDR Americas Distribution at State Street Global Advisors. “As investors search for higher yields, demand for senior loans and high yield corporate bonds is on the rise. HYBL is designed to meet this demand while providing access to Blackstone’s deep expertise across these segments of the credit market.”
As sub-adviser of HYBL, Blackstone will actively manage a portfolio of high yield corporate bonds, senior loans, and debt tranches of US CLOs using a top-down asset allocation approach coupled with bottom-up security selection that seeks to outperform a composite benchmark comprising 50 per cent high yield bonds and 50 per cent senior loans with less volatility than the individual benchmark components over a full market cycle.
The top-down asset allocation approach evaluates macroeconomic, technical, fundamental, and relative value factors to determine the allocation among the asset classes. The bottom-up security selection process relies on fundamental credit research to determine security selection within each asset class, while utilizing a systematic process in high yield bonds to seek to capture credit risk premium by identifying and exploiting potential mispricing at the individual security level.
Dan McMullen, Head of North American Liquid Portfolio Management for Blackstone says: “We see a compelling opportunity to generate income in high yield corporate bonds, senior loans and CLO debt securities through our active management approach. HYBL will build on the proven track record we have established through SRLN with State Street and benefit from our deep expertise in credit investing.”
In April 2013, State Street Global Advisors and Blackstone launched the SPDR Blackstone Senior Loan ETF (SRLN), the first actively managed ETF to provide exposure to senior loans. With over USD6.7 billion of inflows last year, SRLN was the fastest growing US-listed active ETF in all of 2021, the firm writes. Net assets under management in SRLN totaled over USD8.9 billion as of December 31, 2021.