iShares ESG Advanced High Yield Corporate Bond ETF (HYXF US) - Portfolio Construction Methodology

Core Insights - The iShares ESG Advanced High Yield Corporate Bond ETF (HYXF US) targets USD high yield corporate bonds while adhering to strict ESG standards [1] Group 1: Index Construction - The underlying index is the Bloomberg MSCI US High Yield Choice ESG Screened Index, which excludes energy and issuers that do not meet defined ESG criteria [1] - Eligibility criteria for bonds include a minimum of USD 400 million par outstanding, fixed-rate USD denomination, at least 1 year remaining maturity, and non-default speculative-grade ratings [1] - Additional MSCI screens require issuers to have an MSCI ESG Rating of at least BB and exclude those involved in controversial sectors such as tobacco, firearms, and fossil fuels [1] Group 2: Portfolio Management - Constituents of the index are market value weighted with a 2% issuer cap, and any excess is redistributed pro rata [1] - The index undergoes monthly rebalancing at month-end, with additions and deletions based on parent index actions while adhering to ESG and size constraints [1] Group 3: Analytics and Insights - For further exploration of HYXF, the ETF analytics platform provides institutional-grade insights, including performance and risk metrics, correlations, sensitivities, and factor exposure [1]