BondBloxx US Hg Yld Fncl & REIT Str ETF’s management team is rated Average, but a solid investment process still helps this strategy retain its Morningstar Medalist Rating of Bronze. The portfolio maintains a cost advantage over competitors, priced within the lowest fee quintile among peers.  

 The strategy's sensible investment philosophy earns it an Above Average Process Pillar rating. The team managing the passive strategy earns the strategy an Average People Pillar rating. The strategy's parent organization doesn't stand out, earning the firm an Average Parent Pillar rating. It has displayed a handful of investor-friendly attributes including overall reasonable fees and continuity among portfolio managers.

Analyst Rating

BondBloxx US Hg Yld Fncl & REIT Str ETF earns an Above Average Process Pillar rating. Morningstar's evaluation of this security's process aims to determine the likelihood that it will outperform its Morningstar Category index on a risk-adjusted basis over the long term. The main driver of the rating is that this fund tracks an index. Historical data, such as Morningstar's Active/Passive Barometer, finds that passively managed funds have generally outperformed their active counterparts, especially over longer time horizons. The firm's five-year retention rate of 100% also strengthens the process. Lastly, the process is limited by the size of its portfolio management team, only two portfolio managers.

The investment strategy as stated in the fund's prospectus is: 

The investment seeks to track the investment results of the ICE Diversified US Cash Pay High Yield Financial & REIT Index composed of U.S. dollar-denominated, high yield corporate bonds in the financial and REIT sector.  Under normal circumstances, the fund will invest at least 80% of its net assets (plus the amount of any borrowings for investment purposes) in high-yield, below-investment grade bonds denominated in U.S. dollars of issuers in the financial and REIT sector, either directly or indirectly (e.g., and through derivatives). It is non-diversified.  

 This strategy's 12-month yield is 7.0%, higher than its average peer's 6.3%. While a higher yield may deliver more income, it also tends to indicate 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 B. In terms of long-term interest-rate risk, this strategy is on par with peers. The longer a strategy's duration, the more sensitive it is to shifts in interest rates. This fund, with a 3.5-year duration, is expected to gain 3.5% of its net asset value if interest rates drop by 1 percentage point, and vice versa.

Above Average

Process

BondBloxx Investment Management LLC’s team earns An Average People Pillar rating. The number one contributor to the rating is the firm's five-year retention rate of 100%. A low cost, with fees that rank in its category's least costly fifth, also bolsters the rating. A higher expense ratio reduces net returns, so low costs give this team an advantage. Lastly, the rating is limited by the number of months that the management team has been running this vehicle together.

Average

People

Since its inception only two years ago, BondBloxx Investment Management LLC has demonstrated that it can be trusted as much as the next asset manager. As a result, it has an Average Parent Pillar rating. BondBloxx Investment Management LLC currently oversees 25 vehicles, with a total of $2.66 billion under management and a bench of 13 fund managers. BondBloxx Investment Management LLC's management team is composed of mostly veteran managers, averaging 20 years of industry experience. A firm's ability to retain its talent is a crucial indicator of its culture. This has been a strength of BondBloxx Investment Management LLC, which has had lower-than-average manager turnover. 

 BondBloxx Investment Management LLC deserves plaudits for its commitment to low fees for its open-end and exchange-traded funds, which showcases its willingness to prioritize investors. The firm's average net expense ratio across all funds is in the cheapest quintile of firms.  

 To keep an Average rating, BondBloxx Investment Management LLC will be expected to maintain a consistent track record of positive investor experience.

Parent

BondBloxx USD High Yield Bond Financial & REIT Sector ETF

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