Invesco Adds Active Junk Bond ETF

Invesco Adds Active Junk Bond ETF

The fund takes a factor-based approach to bond investing.

Reviewed by: Heather Bell
Edited by: Heather Bell

Today, Invesco has rolled out an actively managed high-yield bond fund. The Invesco High Yield Bond Factor ETF (IHYF) uses a factor-based management approach and has wide latitude to implement derivatives in its portfolio.

The fund comes with an expense ratio of 0.39% and lists on the Nasdaq stock exchange.

The prospectus notes that the fund can purchase securities across the maturity and market capitalization spectrums, and that it targets the value, low volatility and high carry bond factors, among others. The document also says that the fund can use swap, options and futures contracts to manage various risks and, in the case of options, generate additional alpha. Although IHYF can invest in bonds denominated in non-U.S. currencies, it is limited to a 10% portfolio exposure to such issues.

The largest actively managed high-yield bond ETF available to investors is the $2.2 billion First Trust Tactical High Yield ETF (HYLS), which comes with an expense ratio of 1.23%. However, HYLS can hold  both long and short positions.

Contact Heather Bell at [email protected]

Heather Bell is a former managing editor of She has also held editorial positions at Dow Jones Indexes and Lehman Brothers. Bell is a graduate of Dartmouth college and resides in the Denver area with her two dogs.