HYD Fund Description

The Market Vectors High-Yield Municipal ETF tracks a market-weighted index of high-yield long-term tax-exempt municipal bonds.

HYD ETF.com Insight

HYD leads the high-yield municipal ETF space, with over $1B in AUM and a lower fee than its lone competitor. The fund’s basket of bonds pushes out on the yield curve with a weightedHYD takes more interest-rate risk and less credit risk average maturity of 19 years. Perhaps as a trade-off it includes a sizable allocation to investment grade credits. Ultimately, HYD takes more interest-rate risk and less credit risk relative to the high-yield municipal bond market. The fund earns Analyst Pick for decent if not sterling exposure in a package that’s relative painless to own and easy to trade. The fund’s only weakness is poor tracking of its index—a flaw that undercuts the value of its low fee—but an area where peer fund HYMB also struggles. (Insight updated 06/30/2014)

1 Year

Performance [as of 09/16/14] 1 Month 3 Month YTD 1 Year 3 Years 5 Years 10 Years

HYD
1.67% 4.48% 20.25% 24.44% 9.68% 7.94% --
All returns over 1 year are annualized. All returns are total returns unless otherwise stated.

HYD Top 10 Countries

HYD Top 10 Sectors

HYD Top 10 Holdings

HYD Summary Data

Van Eck

A company that produces and manages ETFs.

02/04/09

The first date of a fund's operations, as documented by the issuer.

Open-Ended Fund

The organizational structure of the fund or ETN.

0.35%

The net total annual fee a fund holder pays to the issuer.

$1.17 B

The market value of total assets that a fund has accumulated and now manages on behalf of investors.

$8.94 M

It is the daily dollar value of shares traded, averaged over the past 45 trading days.

0.07%

The difference between the highest price a market participant is willing to pay to buy an ETF and the lowest price at which a market participant is willing to sell an ETF, averaged over the past 60 days, as a percent.

HYD Portfolio Data

9.2

Price sensitivity in percentage to a 100 basis point parallel shift (up or down) in interest rates.

18.9 Years

The weighted average of remaining time until maturity for all securities in the portfolio.

5.94%

The weighted average yield if all securities in the portfolio were held until maturity. Assumes that interest can be reinvested at YTM rate.

10/01/14

The date on which a security's price excludes an upcoming dividend.

580

The number of securities held in the fund as of ETF.com’s analysis date, based on issuer portfolios or the creation basket. If an ETF holds other ETFs, we count every constituent, looking through the ETF wrapper.

HYD Index Data

Barclays Municipal Custom High Yield Composite Index

This is the benchmark an ETF is desigend to track or replicate.

Market Value

A set of rules that the underlying index provider follows to weight its constituent securities.

Market Value

A set of rules that the underlying index provider follows to select its constituent securities.

BarCap Muni High Yield Index

This is the index that we have chosen as the best-in-class gauge for each segment's broad market.

Related ETFs to HYD

HYMB

ETFs from within the same segment or closely related segments with similar investment objectives or market exposures.

HYD ETF.com Efficiency Insight

HYD charges the lower expense ratio of the two high-yield municipal ETFs, but has struggled to track its index which is common in the high yield muni space. HYD’s 1-year performance has lagged its index by as much as 3%. The fund is here to stay however with more than $1B in AUM. (Insight updated 06/30/2014)

Total Return - 06/30/2014

Performance [as of 06/30/14] 1 Month 3 Month YTD 1 Year 3 Years 5 Years 10 Years

HYD
-0.82% 3.39% 9.15% 4.76% 6.83% 7.91% --

HYD (NAV)
-0.54% 3.82% 8.58% 4.18% 6.94% 8.44% --

Barclays Municipal Custom High Yield Composite Index
-0.29% 3.98% 10.24% 5.63% 7.89% 9.81% 5.90%

BarCap Muni High Yield Index
-1.78% 1.55% 7.53% 3.87% 7.69% 9.94% 5.68%
All returns over 1 year are annualized. All returns are total returns unless otherwise stated.

HYD Portfolio Management

0.35%

The net total annual fee a fund holder pays to the issuer.

-2.63%

Compares returns of the fund's NAV to its underlying index for a daily series of overlapping 12 month periods. The median is the middle value of the results.

-1.62%

Largest deviation in a positive direction of a fund's returns vs. its underlying index over the past 12 months.

-3.40%

Largest deviation in a negative direction of a fund's returns vs. its underlying index over the past 12 months.

HYD Tax exposures

20.00% / 39.60%

The maximum long-term and short-term U.S. tax rates applicable to a realized capital gain.

--

The average capital gains paid out to shareholders in the past 36 months, measured as a percent of net asset value (NAV) at the time.

N/A

IRS treatment of the majority of the fund's distributions.

No

ETFs that are structured as commodities pools and classified as limited partnerships by the IRS will issue K-1 forms to holders.

HYD Fund Structure

Open-Ended Fund

The organizational structure of the fund or ETN.

No

An indicator of whether a fund uses over-the-counter derivatives such as swaps or forwards to achieve its objectives.

No

An indicator of whether or not a fund actively lends its portfolio holdings.

100% / 0%

The division of securities lending revenue between the fund and the issuer.

N/A

The institution responsible for providing the return of the stated index and whose credit is the sole backing of the ETN.

N/A

The risk of default by the ETN counterparty.

Low

The likelihood that an issuer will shut down a fund for business or regulatory reasons.

Daily

The frequency of an issuer's disclosure of all fund holdings.

HYD ETF.com Tradability Insight

HYD offers good Tradability for retail and institutional investors alike. It generates over $7M in trading volume on most days, which results in tight spreads for retail investors. However, HYD has poor primary liquidity which is a common issue in the high yield muni space. Institutions should work with market makers for block trades. (Insight updated 06/30/2014)

Average Spread

Premium/Discount

Volume

HYD ETF.com/ Block LiquidityAs of 09/17/2014

5
4
3
2
1

This measurement shows how easy it is to trade 25,000 shares of HYD. HYD is rated a 2 out of 5.

HYD Tradability

295,893

It is the daily number of shares traded, averaged over the past 45 trading days.

$8.94 M

It is the daily dollar value of shares traded, averaged over the past 45 trading days.

243,135

Median number of shares traded over the past 45 trading days.

$7.37 M

Median dollar value of shares traded over the past 45 trading days.

0.07%

The difference between the highest price a market participant is willing to pay to buy an ETF and the lowest price at which a market participant is willing to sell an ETF, averaged over the past 45 days, as a percent.

$0.02

The difference between the highest and lowest posted prices for an ETF, averaged over the past 45 days, in dollars.

-0.17%

The middle value in the ranked set of all premium/discount values over a maximum 12-month period.

0.53% / -2.34%

The greatest amount that the market price exceeded (premium) and fell below (discount) its fair value/net asset value (NAV) over a maximum 12-month period.

None

This flags whether there is currently a systemic issue that has restricted the ability to create or redeem shares of the fund. This may be imposed by the fund's issuer, or by external circumstances.

100.00%

The percent of time that the underlying securities of an ETF are open to trading while US exchanges are open.

100,000

The smallest block of ETF shares that an Authorized Participant can either create or redeem at net asset value (NAV) with the issuer in exchange for the underlying shares of the fund.

2.43

The median 45 day share volume divided by the creation unit size of the fund. The higher the number, the more likely that liquidity providers will trade the fund in size, or in odd lots.

0.02%

The standard fee to create or redeem 1 creation unit of an ETF as a percentage of the dollar value of 1 creation unit.

992

The total number of net outstanding options contracts for an ETF.

$30.57

The total market value of the assets that an ETF holds less fund expenses.

2

An estimate of liquidity for the underlying baskets of securities, scaled 1 to 5.

HYD ETF.com Fit Insight

HYD tilts away from the market with an 8% capping per issuer, resulting in different risk and maturity profile. Compared to our benchmark, it holds higher-rated bonds (including 25% in the BBB tranche) with longer average maturity. Higher-quality reduces credit risk, while the longer maturity increases interest-rate risk. Reduced credit risk dominates heightened duration risk, generating lower YTM than our benchmark. (Insight updated 06/30/2014)

HYD Top 5 Countries

15.50% 8.25%
7.59% 7.14%
3.25% 6.90%
3.98% 6.70%
6.32% 5.25%

HYD Top 5 Currencies

100.00% 100.00%
100.00% 100.00%

HYD Performance Statistics

0.90

The degree to which the fund and its segment benchmark move up and down in unison.

0.91

The sensitivity of the returns of the fund to the movement of the ETF.com segment benchmark. Beta of 1.0 means magnitude of fund returns equals that of IU benchmark returns.

2.08%

The excess return of fund relative to ETF.com segment benchmark on a risk adjusted basis. Only reported if statistically significant.

0.96

The comparison of a fund's return to our benchmark's for days when the benchmark is up. Ideally down beta is less than up beta while beta of 1.0 means they're equal.

0.82

The comparison of a fund's return to our benchmark's for days when the benchmark is down. Ideally down beta is less than up beta while beta of 1.0 means they're equal.

0.05%

A measure of the variability between the fund's returns and the ETF.com segment benchmark returns on days when the fund underperforms the benchmark.

HYD Holdings Statistics

HYD Segment Benchmark
17.26 18.91

The weighted average of remaining time until maturity for all securities in the portfolio.

8.74 9.22

A measure of interest rate risk. Estimates change in value to the portfolio based on a 1% parallel shift in the yield curve.

0.11 0.10

A measure of interest rate risk. Estimates the portfolio's sensitivity to changes in 2 year interest rates holding other rates constant.

5.59 5.03

A measure of interest rate risk. Estimates the portfolio's sensitivity to changes in 10 year interest rates holding other rates constant.

7.08% 5.94%

The weighted average yield if all securities in the portfolio were held until maturity. Assumes that interest can be reinvested at YTM rate.

8.22 8.68

Price sensitivity in percentage to a 100 basis point change (widening or narrowing) of spread relative to Treasury spot curve.

Low Low

The Herfindahl Index number – a metric of portfolio concentration where higher numbers mean higher concentration of holdings.

3,314 580

The number of securities held in the fund as of ETF.com’s analysis date, based on issuer portfolios or the creation basket. If an ETF holds other ETFs, we count every constituent, looking through the ETF wrapper.

BB- BB-

Market–value–weighted average credit quality of the portfolio.

HYD Maturity Distribution

0.22% 0.69%

Percent of the portfolio's exposure to securities with 0 - 1 years until maturity.

3.66% 1.51%

Percent of the portfolio's exposure to securities with 1 - 3 years until maturity.

4.60% 3.33%

Percent of the portfolio's exposure to securities with 3 - 5 years until maturity.

5.92% 4.10%

Percent of the portfolio's exposure to securities with 5 - 7 years until maturity.

7.60% 6.04%

Percent of the portfolio's exposure to securities with 7 - 10 years until maturity

78.00% 84.33%

Percent of the portfolio's exposure to securities with 10+ years until maturity.

HYD Credit Breakdown

0.00% 0.31%

Percent of portfolio's exposure to AAA rated bonds (Investment Grade).

0.16% 0.28%

Percent of portfolio's exposure to AA rated bonds (Investment Grade).

0.00% 1.06%

Percent of portfolio's exposure to A rated bonds (Investment Grade).

2.66% 25.19%

Percent of portfolio's exposure to BBB rated bonds (Investment Grade).

41.30% 24.76%

Percent of portfolio's exposure to BB rated bonds (High Yield).

23.24% 16.63%

Percent of portfolio's exposure to B rated bonds (High Yield).

1.52% 1.51%

Percent of portfolio's exposure to CCC rated bonds (High Yield).

0.04% 0.00%

Percent of portfolio's exposure to CC rated bonds (High Yield).

0.00% 0.00%

Percent of portfolio's exposure to C rated bonds (High Yield).