Columbia Threadneedle Launches Two High-Yield ETFs
With rate cuts coming, the ETFs address a rising demand for high current income, the firm says.
Columbia Threadneedle Investments has launched two actively managed, transparent fixed income exchange-traded funds: the Columbia U.S. High Yield ETF (NYSE Arca: NJNK) and the Columbia Short Duration High Yield ETF (NYSE Arca: HYSD).
The ETFs address a rising market demand for high current income in a low-cost, tax-efficient structure, the firm said last week.
NJNK is managed by Daniel DeYoung, a high yield senior portfolio manager, and David Janssen, a multi-sector fixed income portfolio manager. HYSD is managed by Brett Kaufman and Kris Keller, senior portfolio managers on the high yield team.
NJNK has a 0.46% expense ratio and HYSD has a 0.44% expense ratio.
“We believe that high yield bonds have an important role to play in a diversified portfolio and that that investors should consider making a long-term allocation to the asset class to capture the high levels of income that it can offer,” DeYoung said in a statement.
“With potential cuts to the federal funds rate on the horizon, the benefits of thoughtful exposure to high yield are compelling.”
NJNK seeks to produce high current income with a strategy focused on trimming exposure to the lowest quality, highest risk issuers while also avoiding higher rated, low yielding securities.
HYSD seeks to generate alpha comparable to the team’s other high yield portfolios with short duration, high yield corporate bonds and floating rate loans.
Columbia Threadneedle Investments, Ameriprise Financial’s global asset management business, manages $642 billion of assets. The firm now has 14 ETFs.
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