Weakness in Angel Oak UltraShort Income ETF's People and Process Pillar ratings limits this strategy to a Morningstar Medalist Rating of Negative. The portfolio maintains a cost advantage over competitors, priced within the second-lowest fee quintile among peers.  

 The longest-tenured manager has a wealth of experience, but due to other weaknesses, the strategy earns a Below Average People Pillar. The strategy earns a Below Average Process Pillar rating.  To be considered a quality steward, this strategy's parent organization needs to improve factors like an uncompelling risk-adjusted track record and a relatively inexperienced portfolio management team. As a result, the firm obtains a Below Average Parent Pillar rating.

Analyst Rating

Morningstar's evaluation of this fund's process aims to determine how repeatable, consistent, and reliable it is, and whether management maintains a competitive advantage. Angel Oak Ultrashort Income ETF earns a Below Average Process Pillar rating.    The process benefits from the firm's five-year retention rate of 87% over the period. However, the rating is held back by the parent firm's five-year risk-adjusted success ratio of 20%. The measure indicates the percentage of a firm's funds that survived and outperformed their respective category's median Morningstar Risk-Adjusted Return for the period. The parent's subpar success ratio suggests that the firm could do better across its fund lineup. High costs across its parent firm's funds, whose fees rank in their respective category's costliest quintile on average, also hold the rating back. While this fund's costs are most relevant to investors, the pattern at the broader firm suggests it could do more to keep fees down.

 Compared with other funds in the Ultrashort Bond Morningstar Category, this fund has been consistently sensitive to interest-rate changes over the past few years. Opening the analysis to additional factors, the portfolio has displayed biases over time, whether towards or away from certain fixed-income instruments. Compared with the average strategy in the category, the managers have been underweight corporate bonds in recent years. In the latest month, the strategy has also relatively underweighted corporate bonds compared with Morningstar Category peers. Additionally, there's been an underallocation from A rated bonds over the past few years. Similarly, in recent months, the strategy also had less exposure to A rated bonds than peers. Finally, during the past few years, the fund leaned meaningfully towards debt with 15- to 20-year maturities. In this month, the strategy also leaned more towards debt with 15- to 20-year maturities compared with its peers.

 This strategy's 12-month yield is 6.0%, higher than its average peer's 4.7%. Typically, higher yields come at the cost of higher credit risk. But that isn't always the case. Over the past 12 months, the average yield of the fund has been higher than the average yield of its Morningstar Category peers. The portfolio's average surveyed credit quality is on par with peers, with both the fund and the average being rated A.

Below Average

Process

Angel Oak Ultrashort Income ETF earns a Below Average People Pillar rating. The team is supported by the firm's five-year retention rate of 87%. However, the rating is limited by the parent firm's five-year success ratio of 22%. The measure indicates the percentage of a firm's funds that survived and outperformed their respective category's median return for the period. The parent's modest success ratio suggests that the firm could do better across its fund lineup. The managers' failure to consistently outperform peers at the funds they run, as measured by their combined three-year manager excess returns, also holds the rating back.


Matthew Kennedy, the longest-tenured manager on the strategy, boasts 16 years of listed portfolio management experience. The average Morningstar Rating of the strategies they currently manage is 5.0 stars, indicating that their risk-adjusted returns exceeded the category average. A large cast of nine additional named managers provides appeal, averaging 12 years of listed portfolio management experience.

People

Angel Oak lags peer asset managers in a number of stewardship qualities, resulting in a Below Average Parent Pillar rating. The firm has a poor risk-adjusted performance record. Across all open-end and exchange-traded funds, the firm’s average overall Morningstar Rating is 2.2 stars. With an average asset-weighted tenure of nine years among the longest-tenured managers at Angel Oak, the firm is on par with peers. Seasoned teams tend to have more experience to draw upon should they need to weather turbulent market conditions. Angel Oak has had high portfolio management turnover over the past five years compared with peers, detracting from its rating, as long-term stability tends to go together with positive results.

Parent

Angel Oak Ultrashort Income ETF

UYLD actively invests in a broad portfolio of fixed income securities of various credit qualities. Selection is based on fundamental analysis and managed to provide a dollar-weighted average maturity of less than two years

UYLD actively invests in a broad portfolio of fixed income securities of various credit qualities. Selection is based on fundamental analysis and managed to provide a dollar-weighted average maturity of less than two years.

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Angel Oak Capital Advisors, an investment management firm specializing in value-driven structured credit, has launched its debut exchange-traded fund. The Angel Oak UltraShort Income ETF (NYSE Arca: UYLD), which begins trading on the NYSE Arca today, invests in short-duration structured credit assets and cash-like instruments that seek to provide higher yield without sacrificing credit quality.

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ATLANTA--(BUSINESS WIRE)---- $UYLD #ETF--Angel Oak Capital Advisors enters ETF marketplace with short-duration structured credit focused fund offering, UYLD.

News for Angel Oak Ultrashort Income ETF ETF (UYLD)