American Century Diversified Corporate Bond ETF (KORP US) - Portfolio Construction Methodology

Core Insights - The American Century Diversified Corporate Bond ETF (KORP) focuses on generating current income through U.S.-dollar investment-grade corporate bonds while also allocating to high-yield credit when conditions are favorable [1] Investment Strategy - The ETF employs an actively managed investment strategy that integrates fundamental issuer analysis and quantitative risk budgeting to balance interest-rate and credit risk [1] - Duration is typically maintained within a 3–7 year range to manage interest rate sensitivity without sacrificing yield [1] Portfolio Composition - The investable universe includes U.S. and foreign corporate issuers, with the potential to invest up to 35% of net assets in high-yield corporate and other below-investment-grade securities [1] - Portfolio construction aims for broad industry diversification within corporates, with allocations adjusted based on evolving credit conditions [1] Rebalancing Approach - Rebalancing and adjustments are made based on valuation, spread, and risk-budget signals across different quality tiers and sectors [1]