Eaton Vance High Yield ETF (EVHY US) - Portfolio Construction Methodology

Core Insights - The Eaton Vance High Yield ETF (EVHY) focuses on generating high current income through investments in below-investment-grade corporate bonds, particularly in the higher-quality segment of the high-yield market, typically rated BB and B [1] Investment Strategy - The investment strategy is driven by bottom-up credit research that evaluates business durability, capital structures, covenants, and recovery values [1] - The strategy includes relative-value and liquidity analysis across new issues and secondary markets [1] - Portfolio construction emphasizes diversification across issuers, sectors, and maturities while managing exposure to lower-rated credits opportunistically [1] Risk Management - The ETF controls interest-rate and spread factor risks within defined bands [1] - Position sizes are determined by issuer-specific fundamentals, trading depth, and downgrade/default risk [1] - Risk tools are employed to monitor concentration and factor contributions [1] Rebalancing Approach - Ongoing rebalancing occurs as valuations, catalysts, or credit views change [1] - Sell decisions are based on deteriorating credit quality, unfavorable risk/reward scenarios, or better risk-adjusted income opportunities elsewhere [1]