## [# Federated Hermes Joins The ETF Space](/sections/etf-watch/federated-hermes-joins-etf-space)
# Federated Hermes Joins The ETF Space
The $634 billion asset manager makes its debut with two fixed income funds.
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[By Dan Mika](/contributors/dan-mika)
Dec 17, 2021
Edited by: Dan Mika
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Federated Hermes, a Pittsburgh-based asset manager with approximately $634 billion in assets under management, made its first foray into ETFs with two short-duration bond funds.
The [**Federated Hermes Short Duration Corporate ETF (FCSH)**](https://www.sec.gov/ix?doc=/Archives/edgar/data/1849998/000162363221001548/form.htm) and the [**Federated Hermes Short Duration High Yield ETF (FHYS)**](https://www.sec.gov/ix?doc=/Archives/edgar/data/1849998/000162363221001548/form.htm) both debuted on the NYSE Arca on Friday. FCSH will start with an expense ratio of 0.30%, while FHYS starts with a 0.51% fee. Both funds have a 10 basis point fee waiver in place until the end of 2022.
Federated Hermes ETF Director Brandon Clark said short-duration bond management is a natural entry point for the firm’s first two ETFs based on the firm’s history in that end of the fixed income spectrum.
“We believe these portfolios will be a useful tool for investors who may be looking to shorten their overall portfolio duration in a rising rate environment,” he said.
FCSH will primarily hold investment-grade corporate bonds from U.S. and foreign firms, with a target of keeping its portfolio’s average effective duration between 1 1/2 years and 3 1/2 years. Its benchmark is the Bloomberg 1-5 Year Corporate Index, which has returned a loss of 0.43% over the past 12 months.
FHYS will hold a mix of U.S. and foreign corporate junk bonds, along with options to invest in bank loans, collateralized debt obligations and other asset-backed securities at the discretion of the portfolio managers. It intends to maintain an effective duration under three years in normal market conditions, and is benchmarked against the ICE BofA 0-3 Year Duration-to-Worst US High Yield Constrained Index.
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[ Dan Mika ](/contributors/dan-mika)
Dan Mika is a reporter for etf.com. He has previously covered business for the Ames Tribune and Cedar Rapids Gazette in Iowa, and BizWest Media in… [View Bio](/contributors/dan-mika)
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