KraneShares Asia Pacific High Income Bond ETF (KHYB)

Overview

The KraneShares Asia Pacific High Income Bond ETF (KHYB) seeks to provide current income by investing in high-yield, U.S. dollar-denominated debt securities from issuers in the Asia Pacific region. It focuses on a portfolio of bonds with credit ratings below investment grade and aims to capture the potential for high income and capital appreciation in the Asian high-yield market.

Reputation and Reliability

Krane Funds Advisors, LLC is a well-regarded ETF issuer specializing in China-focused and emerging market investment strategies.

Management Expertise

KraneShares has a dedicated team with extensive experience in emerging markets, particularly in Asia, specializing in navigating the complexities of fixed income and equity investments in the region.

Goal

To seek current income by investing primarily in high-yield, U.S. dollar-denominated debt securities of issuers in the Asia Pacific region.

Investment Approach and Strategy

Strategy: The fund does not aim to replicate a specific index, instead, it employs an active management strategy. The investment strategy seeks current income by investing in debt securities of issuers in the Asia Pacific region.

Composition The ETF holds a portfolio of high-yield (non-investment grade) bonds issued by companies and entities located in the Asia Pacific region. It invests primarily in U.S. dollar-denominated debt.

Market Share: KHYB's market share within the Asia Pacific high yield bond ETF sector varies and is influenced by fund performance and investor flows.

Total Net Assets (AUM): 56.29

Key Competitors

• VanEck J.P. Morgan EM High Yield Bond ETF (HYEM)
• iShares J.P. Morgan USD Emerging Markets High Yield Bond ETF (EMHY)
• Xtrackers USD High Yield Corporate Bond ETF (HYLB)

Competitive Landscape

The high-yield bond ETF market is competitive. KHYB benefits from its specific focus on the Asia Pacific region. This focus provides diversification and potentially higher yields compared to broader emerging market funds. However, it also exposes the fund to region-specific risks. Its AUM is significantly lower than other ETFs in the High Yield Bond ETF sector.

Historical Performance: Historical performance data can be obtained from financial data providers. The ETF's past performance is not necessarily indicative of future results.

Benchmark Comparison: The ETF does not track a specific benchmark index but performance should be compared to the performance of high-yield benchmarks like the ICE BofA US High Yield Index or similar Asia-focused benchmarks.

Expense Ratio: 0.69

Average Trading Volume

The average trading volume is low, indicating lower liquidity than some other bond ETFs.

Bid-Ask Spread

The bid-ask spread can vary depending on market conditions but is typically moderate, reflecting the relative illiquidity of the underlying bonds.

Market Environment Factors

Economic growth in the Asia Pacific region, interest rate movements, credit spreads, and currency fluctuations all impact KHYB's performance.

Growth Trajectory

KHYB's growth depends on investor demand for Asia Pacific high-yield bonds and the fund's ability to deliver competitive returns. Changes in strategy and holdings may occur based on market conditions.

Competitive Edge

KHYB's competitive edge lies in its specific focus on the Asia Pacific high-yield bond market, offering exposure that may not be readily available through broader emerging market or global high-yield funds. KraneShares' expertise in navigating Asian markets and its strong relationships with local issuers can provide access to attractive investment opportunities. The fund offers potential diversification benefits. A major disadvantage is its low AUM.

Volatility

KHYB's volatility can be relatively high due to its focus on high-yield bonds, which are inherently more sensitive to economic conditions and credit risk.

Market Risk

The specific risks associated with KHYB include credit risk (the risk of default by issuers), interest rate risk, currency risk (as the bonds are U.S. dollar-denominated but issued by Asian entities), and geopolitical risk within the Asia Pacific region.

Ideal Investor Profile

The ideal investor is someone seeking high current income and willing to accept a higher level of risk associated with non-investment grade debt. Investors who have a positive outlook on the Asia Pacific economy and its credit markets and are looking for diversification beyond developed markets may find it suitable.

Market Risk

KHYB is best suited for investors with a long-term investment horizon who understand the risks associated with high-yield bonds and emerging markets and can tolerate potential price volatility.

The KraneShares Asia Pacific High Income Bond ETF (KHYB) offers exposure to high-yield, U.S. dollar-denominated debt from issuers in the Asia Pacific region, targeting current income. It benefits from KraneShares' expertise in Asian markets but carries higher risk due to its focus on non-investment grade debt. Its AUM is low, which may concern some investors. Ideal investors are those seeking high current income and are willing to take a higher level of risk associated with non-investment grade bonds.

Data Sources:

• KraneShares official website
• ETF.com
• Morningstar
• Bloomberg

Disclaimers:

The data and analysis provided are for informational purposes only and should not be considered investment advice. Investors should conduct their own research and consult with a financial advisor before making any investment decisions. Performance data is historical and does not guarantee future results. Market conditions are subject to change.