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Schwab Launches High-Yield Bond ETF

By Dinah Wisenberg Brin

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Charles Schwab’s asset management arm today announced the new Schwab High Yield Bond ETF (NYSE Arca: SCYB), which is expected to start trading on or near July 11.

The ETF’s 0.10% expense ratio is in line with the lowest fee ETFs in the Morningstar High Yield Bond category, Schwab said. The fund will provide simple access to the U.S. dollar-denominated high-yield corporate bond market and can play a role in a diversified portfolio, the firm said.

“The Schwab High Yield Bond ETF is a timely addition to our lineup of fixed income ETFs as investors continue to seek out low-cost, straightforward products that help diversify their portfolios,” said Nicohl Bogan, Schwab Asset Management director of product strategy and development.

“SCYB is a compelling offering for investors seeking potentially higher-yielding fixed income with the inherent benefits of an ETF, including tax efficiency and ease of trading.”

The Schwab High Yield Bond ETF seeks to track as closely as possible, before fees and expenses, the total return of the ICE BofA US Cash Pay High Yield Constrained Index, and to provide broad exposure to the U.S. high-yield corporate bond market with a focus on liquidity and investment risk mitigation.

Image: Bloomberg

Dinah Wisenberg Brin

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