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UCTUSFA VanEck US Fallen Angel High Yield Bond UCITS ETF Please read important disclosure Close important disclosure true
Marketing Communication
USFA

US Fallen Angels ETF
VanEck US Fallen Angel High Yield Bond UCITS ETF

Marketing Communication
USFA

US Fallen Angels ETF
VanEck US Fallen Angel High Yield Bond UCITS ETF

ISIN: IE000J6CHW80 copy-icon
WKN: A3EEYM copy-icon
research-link-icon Why invest in a Falllen Angels ETF?
Why Invest
Documents
research-link-icon Fact Sheet
research-link-icon KID
research-link-icon Prospectus

Fund Description

VanEck currently manages the largest ETF fallen angels strategy in the world. VanEck US Fallen Angel High Yield Bond UCITS ETF offers access to corporate bonds initially issued with investment grade status and then downgraded to high yield. The bonds need to be US dollar denominated and issued in the US domestic market, by both US and non US issuers from developed countries. The strategy presents a strong track record and an interesting investment case, characterized by the following main points.

  • NAV
    $22.59

    as of 20 Dec 2024
  • YTD RETURNS
    5.53%

    as of 20 Dec 2024
  • Total Net Assets
    $25.5 million

    as of 20 Dec 2024
  • Total Expense Ratio
    0.35%
  • Inception Date
    01 Sep 2023
  • SFDR Classification
    Article 6
research-link-icon Why invest in a Falllen Angels ETF?
Why Invest
Documents
research-link-icon Fact Sheet
research-link-icon KID
research-link-icon Prospectus

Overview

Fund Description

VanEck currently manages the largest ETF fallen angels strategy in the world. VanEck US Fallen Angel High Yield Bond UCITS ETF offers access to corporate bonds initially issued with investment grade status and then downgraded to high yield. The bonds need to be US dollar denominated and issued in the US domestic market, by both US and non US issuers from developed countries. The strategy presents a strong track record and an interesting investment case, characterized by the following main points:

  • Timing: corporate bonds are included when the downgrade to High Yield takes place, with historical evidence pointing to a subsequent price recovery.
  • Contrarian Approach: by investing in downgraded bonds often an exposure to sectors undergoing turmoil is achieved. Examples include the financial sector in the aftermath of the GFC or the energy sector in 2016.
  • Potentially oversold market dynamic: many institutional investors are forced by their mandates to own only investment grade securities, which could cause excessive selling pressure on the securities when the downgrade takes place.
  • Rising stars: fallen angel bonds tend to display a higher tendency to regain investment grade status, when compared to the broad high yield spectrum.


1Past performance is not a reliable indicator for future performance. Risk factors: You may lose money up to the total loss of your investment due to the Risk of Investing in high yield securities, Credit Risk and Interest Rate Risk as described in the Main Risk Factors,

KID

and Prospectus.



Underlying Index

ICE US Fallen Angel High Yield 10% Constrained Index

Fund Highlights

  • Timing: corporate bonds are included when the downgrade to High Yield takes place, with historical evidence pointing to a subsequent price recovery.
  • Contrarian Approach: by investing in downgraded bonds often an exposure to sectors undergoing turmoil is achieved. Examples include the financial sector in the aftermath of the GFC or the energy sector in 2016.
  • Potentially oversold market dynamic: many institutional investors are forced by their mandates to own only investment grade securities, which could cause excessive selling pressure on the securities when the downgrade takes place.
  • Rising stars: fallen angel bonds tend to display a higher tendency to regain investment grade status, when compared to the broad high yield spectrum.


1Past performance is not a reliable indicator for future performance. Risk factors: You may lose money up to the total loss of your investment due to the Risk of Investing in high yield securities, Credit Risk and Interest Rate Risk as described in the Main Risk Factors,

KID

and Prospectus.



Underlying Index

ICE US Fallen Angel High Yield 10% Constrained Index

Capital Markets

VanEck partners with esteemed market makers to ensure the availability of our products for trading on the mentioned stock exchanges. Our Capital Markets team is committed to continuously monitoring and assessing spreads, sizes, and prices to ensure optimal trading conditions for our clients. Furthermore, VanEck ETFs are available on various trading platforms, and we collaborate with a wider range of reputable Authorized Participants (APs) to promote an efficient and fair trading environment. For more information about our APs and to contact our Capital Markets team, please visit factsheet capital markets.pdf

Performance

Holdings

Portfolio

Documents

Index

Index Description

ICE US Fallen Angel High Yield 10% Constrained Index tracks the performance of US dollar denominated below investment grade corporate debt publicly issued in the US domestic market and that were rated investment grade at the point of issuance.

Index Key Points

Underlying Index
ICE US Fallen Angel High Yield 10% Constrained Index

Index Composition
ICE US Fallen Angel High Yield 10% Constrained Index selects high yield corporate bonds that were issued with investment grade rating. The securities need to be US dollar denominated and issued in the US domestic market. The index employs a market capitalization weighting scheme.

  • Single issuers weightings are capped at 10%
  • Eligible securities must have a below investment grade status but have been originally issued with an investment grade rating
  • Eligible securities must have at least 18 months to maturity at the time of issuance and at least one year to maturity as of the rebalancing date
  • Minimum amount outstanding of $250 million

Index Provider
ICE Data Indices, LLC

For more information about the index please click here

 

Awards

Main Risks

Main Risk Factors of a Fallen Angels ETF

  • Credit Risk
  • High Yield Securities Risk
  • Interest Rate Risk
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The issuer or guarantor of a debt security may be unable and/or unwilling to make timely interest payments and/or repay the principal on its debt or to otherwise honour its obligations. Bonds are subject to varying degrees of credit risk which may be reflected in credit ratings. There is a possibility that the credit rating of a bond may be downgraded after purchase, which may adversely affect the value of the security.

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The prices of junk bonds are likely to be more sensitive to adverse economic changes or individual issuer developments than higher rated securities possibly leadong to junk bond issuers not being able to service their principal and interest payment obligations. The secondary market for securities that are junk bonds may be less liquid than the markets for higher quality securities.

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Bond prices could rise or fall as the result of changes in the interest rates and the interest rate curve. Potential or actual downgrades in the credit rating can increase the assumed risk level.

For more information on risks, please see the “Risk Factors” section of the relevant Fund’s prospectus, available on www.vaneck.com.