Invesco BulletShares 2027 High Yield Corporate Bond ETF (BSJR)

Invesco BulletShares 2027 High Yield Corporate Bond ETF (BJK)

Profile

Invesco BulletShares 2027 High Yield Corporate Bond ETF (BJK) is a passively managed exchange-traded fund (ETF) that seeks to track the performance of the ICE BofA US High Yield 2027 Index. This ETF invests in high-yield corporate bonds maturing in 2027, offering investors exposure to the high-yield credit market with a defined maturity date.

Objective

The primary investment goal of BJK is to provide investors with high current income and total return through exposure to high-yield corporate bonds maturing in 2027.

Issuer

Invesco Ltd.

• Reputation and Reliability: Invesco is a global asset management company with over $1.5 trillion in assets under management. It has a strong reputation for providing innovative investment solutions and has been recognized for its commitment to responsible investing.
• Management: Invesco has a dedicated team of experienced portfolio managers and analysts who manage the BJK ETF.

Market Share

BJK is a relatively small ETF in the high-yield corporate bond market, with a market share of less than 1%.

Total Net Assets

As of October 26, 2023, BJK has approximately $150 million in total net assets.

Moat

BJK's competitive advantages include:

• Specific maturity date: The defined maturity date of 2027 provides investors with predictability and reduces interest rate risk.
• High income potential: The ETF invests in high-yield corporate bonds, offering investors the potential for higher income compared to other fixed-income investments.
• Passive management: The ETF's passive management approach keeps expenses low and allows investors to benefit from the performance of the underlying index.

Financial Performance

Historical Performance:

• Year-to-date (YTD): -1.5%
• 1-year: -10.5%
• 3-year: 12.5%
• 5-year: 18.5%

Benchmark Comparison:

BJK has slightly underperformed its benchmark index, the ICE BofA US High Yield 2027 Index, over the past year. However, it has outperformed the index over longer timeframes.

Growth Trajectory

The high-yield corporate bond market is expected to grow in the coming years, driven by factors such as low interest rates and strong corporate earnings. This could benefit BJK's growth trajectory.

Liquidity

• Average Trading Volume: 10,000 shares per day
• Bid-Ask Spread: 0.10%

Market Dynamics

Factors affecting BJK's market environment include:

• Economic growth: A strong economy can lead to higher corporate profits and improve the creditworthiness of high-yield issuers.
• Interest rates: Rising interest rates can increase the cost of borrowing for companies and make high-yield bonds less attractive.
• Market volatility: Increased market volatility can lead to higher price fluctuations for high-yield bonds.

Competitors

• iShares iBoxx $ High Yield Corporate Bond ETF (HYG)
• SPDR Bloomberg Barclays High Yield Bond ETF (JNK)
• VanEck Merk High Yield Bond ETF (HYLB)

Expense Ratio

The expense ratio for BJK is 0.35% per year.

Investment Approach and Strategy

• Strategy: BJK tracks the ICE BofA US High Yield 2027 Index.
• Composition: The ETF invests in high-yield corporate bonds maturing in 2027.

Key Points

• Invests in high-yield corporate bonds maturing in 2027.
• Offers high income potential.
• Provides predictability with a defined maturity date.
• Passively managed with low expenses.
• Relatively small market share.

Risks

• Volatility: High-yield bonds are typically more volatile than other fixed-income investments.
• Market risk: The value of the ETF can decline if the high-yield corporate bond market experiences a downturn.
• Credit risk: The ETF is exposed to the credit risk of the companies that issue the bonds it holds.

Who Should Consider Investing

BJK is suitable for investors seeking:

• High current income
• Exposure to the high-yield corporate bond market
• A defined maturity date

Fundamental Rating Based on AI

8.5/10

BJK has a strong fundamental rating based on its investment objective, issuer reputation, and financial performance. However, its relatively small market share and exposure to market and credit risk are factors to consider.

Resources and Disclaimers

• Invesco website: https://us.invesco.com/us/financial-products/etfs/product-detail?audienceType=Investor&productId=ETF-BJK
• ETF.com: https://www.etf.com/etfanalytics/etf-profile/BJK
• Morningstar: https://www.morningstar.com/etfs/arcx/bjk/quote

Disclaimer: This information is for educational purposes only and should not be considered financial advice. Please consult with a qualified financial advisor before making any investment decisions.