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Is FlexShares High Yield Value-Scored Bond ETF (HYGV) a Strong ETF Right Now?
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Making its debut on 07/17/2018, smart beta exchange traded fund FlexShares High Yield Value-Scored Bond ETF (HYGV - Free Report) provides investors broad exposure to the High-Yield/Junk Bond ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
HYGV is managed by Flexshares, and this fund has amassed over $1.23 billion, which makes it one of the larger ETFs in the High-Yield/Junk Bond ETFs. This particular fund, before fees and expenses, seeks to match the performance of the NORTHERN TRUST HY VLU-SCRD US CORP BD ID.
The Northern Trust High Yield Value-Scored US Corporate Bond Index measures the performance of a diversified universe of high yield, US-dollar denominated bonds of companies exhibiting favorable fundamental qualities, market valuations and liquidity.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for HYGV are 0.37%, which makes it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 7.86%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
Looking at individual holdings, Carvana Co Sr Sec Pik 31-6-1-2031 (CVNA) accounts for about 1.15% of total assets, followed by Staples Inc Callable Notes Fixed 10.75%-9-1-2029 (SPLS) and Directv Financing Llc / Directv Financing-10.00% (DTV).
The top 10 holdings account for about 8.26% of total assets under management.
Performance and Risk
So far this year, HYGV return is roughly 2.53%, and it's up approximately 7.84% in the last one year (as of 06/18/2025). During this past 52-week period, the fund has traded between $38.45 and $41.67.
The fund has a beta of 0.43 and standard deviation of 8.00% for the trailing three-year period. With about 1014 holdings, it effectively diversifies company-specific risk .
Alternatives
FlexShares High Yield Value-Scored Bond ETF is not a suitable option for investors seeking to outperform the High-Yield/Junk Bond ETFs segment of the market. Instead, there are other ETFs in the space which investors should consider.
iShares iBoxx $ High Yield Corporate Bond ETF (HYG) tracks Markit iBoxx USD Liquid High Yield Index and the iShares Broad USD High Yield Corporate Bond ETF (USHY) tracks BofA Merrill Lynch U.S. High Yield Constrained Index. iShares iBoxx $ High Yield Corporate Bond ETF has $16.98 billion in assets, iShares Broad USD High Yield Corporate Bond ETF has $23.32 billion. HYG has an expense ratio of 0.49% and USHY changes 0.08%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the High-Yield/Junk Bond ETFs
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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Is FlexShares High Yield Value-Scored Bond ETF (HYGV) a Strong ETF Right Now?
Making its debut on 07/17/2018, smart beta exchange traded fund FlexShares High Yield Value-Scored Bond ETF (HYGV - Free Report) provides investors broad exposure to the High-Yield/Junk Bond ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
HYGV is managed by Flexshares, and this fund has amassed over $1.23 billion, which makes it one of the larger ETFs in the High-Yield/Junk Bond ETFs. This particular fund, before fees and expenses, seeks to match the performance of the NORTHERN TRUST HY VLU-SCRD US CORP BD ID.
The Northern Trust High Yield Value-Scored US Corporate Bond Index measures the performance of a diversified universe of high yield, US-dollar denominated bonds of companies exhibiting favorable fundamental qualities, market valuations and liquidity.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for HYGV are 0.37%, which makes it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 7.86%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
Looking at individual holdings, Carvana Co Sr Sec Pik 31-6-1-2031 (CVNA) accounts for about 1.15% of total assets, followed by Staples Inc Callable Notes Fixed 10.75%-9-1-2029 (SPLS) and Directv Financing Llc / Directv Financing-10.00% (DTV).
The top 10 holdings account for about 8.26% of total assets under management.
Performance and Risk
So far this year, HYGV return is roughly 2.53%, and it's up approximately 7.84% in the last one year (as of 06/18/2025). During this past 52-week period, the fund has traded between $38.45 and $41.67.
The fund has a beta of 0.43 and standard deviation of 8.00% for the trailing three-year period. With about 1014 holdings, it effectively diversifies company-specific risk .
Alternatives
FlexShares High Yield Value-Scored Bond ETF is not a suitable option for investors seeking to outperform the High-Yield/Junk Bond ETFs segment of the market. Instead, there are other ETFs in the space which investors should consider.
iShares iBoxx $ High Yield Corporate Bond ETF (HYG) tracks Markit iBoxx USD Liquid High Yield Index and the iShares Broad USD High Yield Corporate Bond ETF (USHY) tracks BofA Merrill Lynch U.S. High Yield Constrained Index. iShares iBoxx $ High Yield Corporate Bond ETF has $16.98 billion in assets, iShares Broad USD High Yield Corporate Bond ETF has $23.32 billion. HYG has an expense ratio of 0.49% and USHY changes 0.08%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the High-Yield/Junk Bond ETFs
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.