BlackRock's active high-yield ETF BRHY tracks passive index HYG, showing no outperformance and slightly worse drawdowns.

BlackRock's active high-yield bond ETF, BRHY, has closely mirrored the performance of its passive counterpart, HYG, since its launch in mid-2024. Instead of delivering the expected benefits of active management, BRHY behaves like a 'closet indexer,' tracking the broad market without outperforming it. The fund has experienced slightly worse peak-to-trough drawdowns compared to the passive index. With U.S. high-yield credit spreads at historically tight levels and a low SEC yield of 6.24%, investors face an asymmetric risk profile with limited compensation for sub-investment-grade default risk.