Dallas, Texas 09/10/2013 (Financialstrend) – Over the past few years, the exchange-traded product business has grown in leaps and bounds. This is because the number of ETN’s and ETF’s like Credit Suisse High Yield Bond Fund (ETF) (NYSEMKT:DHY) that have been trading in the United States has grown to almost 1,500 with close to $1.5M in assets under their management. As per the new research that Credit Suisse has published, globally, there is more than $2.1M in funds and there are 3,660 funds.
The ETF business
This banking giant has forecasted more growth for this industry but has also noted that the size of some of the ETF’s and regulation may impact the market liquidity. Credit Suisse has noted that the Volcker Rule and Basel 3 might limit the ETF trading partners in the primary and secondary markets. It may also end up limiting the inventory carried by external traders.
The bank also noted that even if some of the ETF’s begin trading like close-end funds (which is not a very likely scenario), ETF’s like DHY are still a tax-efficient, low-cost, greatly diversified tool for investors. These ETF’s will continue to scrape-off a share from the rest of the actively managed world.
About the company
DHY is a closed-end, non-diversified, management investment company. Its main objective is to seek high current-income. Its secondary-objective is capital appreciation. DHY invests in below-investment-grade United States fixed-income securities. It has the ability to leverage portfolio in an effort to enhance potential-income and also hedge against specific risks.
The Fund invests upto 80 percent of its total assets in fixed-income securities of the U.S. issuers that are rated below investment-grade quality. The company may also invest upto 20 percent of its total assets in various securities. Credit Suisse Asset Management, LLC is the investment advisor if the fund. The company invests in different industries such as aerospace and defense, auto loans, agriculture, auto parts and equipment, brokerage, beverages, building and construction, consumer products, chemical and electronics amongst others.