American Century Diversified Corporate Bond ETF (KORP)

Overview

The American Century Diversified Corporate Bond ETF (KORP) seeks to provide total return by investing primarily in a diversified portfolio of U.S. dollar-denominated corporate bonds. The ETF aims to achieve this objective by actively managing a portfolio of investment-grade and high-yield corporate bonds.

Reputation and Reliability

American Century Investments has a long history in asset management, with a reputation for research-driven investment strategies and a commitment to client outcomes. They are considered a reliable issuer.

Management Expertise

American Century's fixed income team has extensive experience managing corporate bond portfolios across various market cycles. They employ a rigorous research process and active management approach.

Goal

To provide total return.

Investment Approach and Strategy

Strategy: The ETF is actively managed, meaning the portfolio managers select bonds based on their analysis and market outlook rather than tracking a specific index.

Composition The ETF primarily holds U.S. dollar-denominated corporate bonds, including both investment-grade and high-yield (below investment grade) debt.

Market Share: KORP holds a relatively small market share within the broader corporate bond ETF universe.

Total Net Assets (AUM): 167700000

Key Competitors

• iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD)
• Vanguard Total Corporate Bond ETF (VTC)
• SPDR Portfolio Corporate Bond ETF (SPBO)

Competitive Landscape

The corporate bond ETF market is dominated by a few large players offering passively managed, index-tracking funds. KORP differentiates itself through active management, seeking to outperform the benchmark, but this also comes with higher expenses. Competing with passively managed ETFs regarding costs, KORP needs to provide significant alpha to justify its expense ratio. KORP has a smaller market share than larger, more established competitors.

Historical Performance: Historical performance data should be obtained from reliable sources, such as Morningstar or the fund's official website. (Data cannot be dynamically provided).

Benchmark Comparison: Benchmark comparison data should be obtained from reliable sources, such as Morningstar or the fund's official website. (Data cannot be dynamically provided).

Expense Ratio: 0.29

Average Trading Volume

KORP's average trading volume is moderate, which may affect the ease of buying or selling large blocks of shares.

Bid-Ask Spread

The bid-ask spread is typically small, indicating relatively good liquidity, but this can vary with market conditions.

Market Environment Factors

Economic growth, interest rate levels, credit spreads, and corporate earnings all impact KORP. Changes in interest rates and economic activity may impact total return.

Growth Trajectory

The growth trajectory of KORP depends on its ability to deliver competitive returns relative to its benchmark and passive alternatives. Future growth may be tied to shifts in the portfolio managers' decisions and the active portfolio composition.

Competitive Edge

KORP's competitive advantage lies primarily in its active management approach. American Century believes its investment team can identify undervalued corporate bonds and generate alpha. This active management allows flexibility to adjust to changing market conditions, potentially mitigating risk and enhancing returns. However, it also adds higher expenses compared to passive strategies and depends on the skill of the portfolio manager.

Volatility

KORP's volatility depends on the credit quality and duration of the underlying bonds. High yield bonds could increase volatility and decrease fund performance.

Market Risk

The ETF is subject to market risk, including interest rate risk, credit risk, and liquidity risk. Rising interest rates could negatively impact bond prices, and corporate defaults could lead to losses.

Ideal Investor Profile

The ideal investor is seeking current income and some capital appreciation from corporate bonds. An investor with a moderate risk tolerance may choose to invest in KORP.

Market Risk

The ETF is suitable for long-term investors seeking to diversify their fixed-income exposure and those who believe in active management to outperform the market.

American Century Diversified Corporate Bond ETF (KORP) is an actively managed corporate bond ETF that invests primarily in U.S. dollar-denominated corporate bonds. It aims to provide total return through security selection and active management. However, KORP competes with larger, passively managed ETFs in the same asset class. Investors must carefully assess the ETF's historical performance and risk factors to determine if it aligns with their investment goals and risk tolerance. The active management approach aims to generate alpha, but it also comes with higher expenses compared to passive strategies.

Data Sources:

• American Century Investments Website
• Morningstar
• ETF.com

Disclaimers:

This analysis is based on publicly available information and is not financial advice. Investment decisions should be made in consultation with a qualified financial advisor. Data may not be real-time and may be subject to change.