Overlay Shares Core Bond ETF (OVB)

Justin Boller

14 September 2021

 

We are excited our Overlay Shares Core Bond ETF (OVB) has been selected as finalist in the  Best Active ETF and Best Fixed Income ETF categories for the Fund Intelligence Mutual Fund Industry and ETF Awards 2021. In anticipation of the awards, we wanted to provide some further information to showcase our Overlay Shares Core Bond ETF. 

Overlay Shares Core Bond ETF (OVB) aims to deliver an innovative approach for a low yielding fixed income environment. The Fund combines exposure to high quality, investment grade bonds with an active overlay that seeks to generate additional income. The strategy aims to allow investors to maintain diversification benefits sought after by traditional bond investing with the potential for additional income through option premium collection.

The fund has yielded income nearly double that of the Bloomberg Barclays US Aggregate Bond Index (12-Month Yield of 3.80% vs. 1.82%)*. From a total return perspective, OVB has delivered attractive results relative to its peers in the Morningstar Intermediate Core Bond Category since inception, ranking in the 2nd percentile of all funds in the category**.

While income overlay strategies are not new, they have historically come with operational complexities that have made them challenging for many investors to properly access. Packaging this process in a transparent, easy to access ETF brings sophisticated solutions to a broader investor audience.

 

Performance data quoted represents past performance and is no guarantee of future results. Investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. For the most recent month-end performance, please call 1-866-704-OVLS. To view the Fund's standardized performance click here.

* As of 8/31/2021. 12 Month Yield is the sum of a fund's total trailing 12-month interest and dividend payments divided by the last month's ending share price (NAV) plus any capital gains distributed over the same period.

** Since the fund’s inception (inception date 9/30/2019), the fund returned 6.41% at NAV versus the category which returned 3.79%.

Bloomberg Barclays US Aggregate Bond Index– The Bloomberg Barclays US Aggregate Bond Index is an unmanaged index commonly used as benchmarks to measure the performance and characteristics of investment grade fixed income securities. Direct investment in an index is not possible.

The Morningstar Intermediate Bond Category includes intermediate-term core bond portfolios that invest primarily in investment-grade U.S. fixed-income issues including government, corporate, and securitized debt, and hold less than 5% in below-investment-grade exposures. Their durations (a measure of interest-rate sensitivity) typically range between 75% and 125% of the three-year average of the effective duration of the Morningstar Core Bond Index.

Investments involve risk including the possible loss of principal. The Fund’s Overlay strategy involves investing in options that derive their performance from the performance of the S&P 500 Index. Selling (writing) and buying options are speculative activities and entail greater than ordinary investment risks.

For more information and to learn more about the Fund please (click here).

Justin Boller

Justin serves as Portfolio Manager and Director of Portfolio Strategy for the Overlay Shares team.