American Century Diversified Corporate Bond ETF (KORP)

Overview

The American Century Diversified Corporate Bond ETF (KCOR) aims to provide a high level of current income by investing in a diversified portfolio of U.S. dollar-denominated investment-grade corporate bonds. It focuses on a broad range of maturities and sectors within the corporate bond market to manage risk and enhance returns. KCOR utilizes a quantitative model-driven approach to security selection and portfolio construction.

Reputation and Reliability

American Century Investments has a long history and established reputation in the asset management industry. They are known for their disciplined investment approach and commitment to research.

Management Expertise

American Century has a dedicated team of fixed-income professionals with extensive experience in corporate bond investing and quantitative analysis.

Goal

To provide a high level of current income.

Investment Approach and Strategy

Strategy: The ETF does not track a specific index but uses a quantitative model to identify and select corporate bonds. They seek to add value through security selection and sector allocation within the investment-grade corporate bond market.

Composition The ETF primarily holds U.S. dollar-denominated investment-grade corporate bonds across various sectors and maturities.

Market Share: KCOR holds a relatively small market share compared to larger, more established corporate bond ETFs.

Total Net Assets (AUM): 56384271

Key Competitors

• LQD
• VCSH
• AGG

Competitive Landscape

The corporate bond ETF market is highly competitive, dominated by large, well-established funds like LQD and AGG. KCOR differentiates itself through its quantitative, active management approach, which aims to outperform traditional index-tracking strategies. However, this active approach also results in a higher expense ratio compared to passive ETFs. KCOR's smaller size can limit liquidity compared to its larger competitors.

Historical Performance: Historical performance data not readily available in structured format.

Benchmark Comparison: Benchmark comparison data not readily available in structured format.

Expense Ratio: 0.29

Average Trading Volume

The average trading volume for KCOR is relatively low, indicating moderate liquidity.

Bid-Ask Spread

The bid-ask spread can be wider compared to more heavily traded ETFs, potentially increasing trading costs.

Market Environment Factors

Economic indicators, interest rate movements, credit spreads, and overall market sentiment significantly impact KCOR. Changes in interest rates can affect bond prices, while credit spreads reflect the perceived riskiness of corporate debt.

Growth Trajectory

Growth trends depend on the demand for actively managed fixed income strategies and the ETF's ability to deliver competitive performance. Changes to strategy or holdings are determined by American Century's investment process.

Competitive Edge

KCOR's competitive advantage lies in its active, quantitative management approach, aiming to outperform passive corporate bond ETFs. The ETF employs a proprietary model to identify undervalued bonds and manage portfolio risk. This approach allows for flexibility in security selection and sector allocation, potentially generating higher returns than a static index-tracking strategy. However, this active management also carries the risk of underperformance.

Volatility

Volatility depends on the interest rate sensitivity and credit quality of the underlying bonds. Investment-grade corporate bonds generally exhibit moderate volatility.

Market Risk

Specific risks include interest rate risk (rising rates can decrease bond values), credit risk (issuers may default), and liquidity risk (difficulty selling bonds quickly).

Ideal Investor Profile

Ideal investors are those seeking current income from investment-grade corporate bonds and are comfortable with a moderately active management style. Suitable for investors who believe active management can add value in the corporate bond market.

Market Risk

Suitable for long-term investors seeking income and diversification within their fixed income portfolio, though active traders may find lower liquidity less appealing.

The American Century Diversified Corporate Bond ETF (KCOR) is an actively managed ETF focusing on investment-grade corporate bonds. Its strength is quantitative model-driven approach, aiming for higher income through active management. However, it faces competition from larger passive ETFs and has a higher expense ratio. It is suitable for investors comfortable with active management and seeking to enhance income from investment-grade corporate bonds.

Data Sources:

• American Century Investments Website
• ETF.com
• Morningstar

Disclaimers:

The data provided is for informational purposes only and should not be considered investment advice. Market data is subject to change. Consult with a qualified financial advisor before making any investment decisions.