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Fixed Income

Virtus Newfleet Dynamic Credit ETF

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Ticker
BLHY
CUSIP
92790A207
Closing Price
$
(as of 07/16/2018)
Inception
12/05/2016
Premium/Discount
$-0.04
(as of 07/16/2018)
4PM Bid/Offer Midpoint
$24.59
(as of 07/16/2018)
Shares Outstanding
3,354,000
(as of 07/16/2018)
Daily Trading Volume
7,000.00
(as of 07/16/2018)
20 Day Average Trading Volume
23,310.00
(as of 07/16/2018)
Net Assets
$82,596,964
(as of 07/16/2018)
Investment Overview

The Fund seeks high current income and capital appreciation, and may provide a rising interest rate hedge. It offers a way to outsource the complexity of allocating between two rapidly converging non-investment-grade credit sectors: high yield corporate bonds and floating rate bank loans.

Management Team

Investment Partner

Newfleet Asset Management, LLC

Newfleet Asset Management leverages the knowledge and skill of a team of investment professionals with expertise in every sector of the bond market, including evolving, specialized, and out-of-favor sectors. The team employs active sector rotation and disciplined risk management to portfolio construction.

Visit the Newfleet Asset Management, LLC website
Investment Professionals
David Albrycht, CFA
David L. Albrycht, CFA

President and Chief Investment Officer

Industry start date: 1985

Start date with fund: 2016

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Francesco Ossino
Francesco Ossino

Senior Managing Director and Senior Portfolio Manager

Industry start date: 1996

Start date with fund: 2016

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Jonathan Stanley
Jonathan Stanley, CFA

Managing Director and Portfolio Manager

Industry start date: 1997

Start date with fund: 2016

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Key Features
Diversification

Combines two compelling non-investment-grade bond segments with historically low correlations to core fixed income into one portfolio

Active Sector Weightings

Top-down analysis determines sector allocations and industry positioning, with the ability to invest up to 100% in U.S. Treasuries when market conditions warrant

Extensive Fundamental Research

Security selection driven by bottom-up analysis of individual bond quality, credit risk, valuation, company management, structure, and technical elements

Positions & Distributions

Positions
(as of 07/17/2018)
Security % of Portfolio
JP MORGAN USD GOVT MONEY MARKET INSTL 1.740
10.63
UNIVISION COMMUNICATIONS 5.086 03/15/2024
1.11
1.11
VERTAFORE INC 5.593 07/02/2025
0.80
0.80
FEDERAL-MOGUL LLC 6.086 04/15/2021
0.77
0.77
WALTER INVESTMENT MGMT 8.336 06/30/2022
0.75
0.75
KRONOS INC/MA 5.354 11/01/2023
0.73
0.73
PI US MERGERCO INC 5.836 01/01/2025
0.70
0.70
BANFF MERGER SUB INC 6.587 06/28/2025
0.69
0.69
TRANSDIGM INC 4.836 06/09/2023
0.69
0.69
INEOS US FINANCE LLC 4.336 03/31/2024
0.67
0.67
Distribution History2
Ex-Date Record Date Payable Date Dividend Income ST Capital Gains LT Capital Gains Distribution Total
07/20/2017 07/24/2017 07/31/2017 0.093290 0.000000 0.000000 0.093290
08/21/2017 08/23/2017 08/30/2017 0.100620 0.000000 0.000000 0.100620
09/20/2017 09/21/2017 09/29/2017 0.095480 0.000000 0.000000 0.095480
10/20/2017 10/23/2017 10/30/2017 0.099170 0.000000 0.000000 0.099170
11/20/2017 11/21/2017 11/28/2017 0.105830 0.000000 0.000000 0.105830
12/20/2017 12/21/2017 12/28/2017 0.141760 0.083240 0.000000 0.225000
01/22/2018 01/23/2018 01/30/2018 0.071300 0.000000 0.000000 0.071300
02/21/2018 02/22/2018 02/28/2018 0.095780 0.000000 0.000000 0.095780
03/20/2018 03/21/2018 03/28/2018 0.096090 0.000000 0.000000 0.096090
04/20/2018 04/23/2018 04/30/2018 0.123290 0.000000 0.000000 0.123290
05/22/2018 05/23/2018 05/31/2018 0.111070 0.000000 0.000000 0.111070
06/20/2018 06/21/2018 06/28/2018 0.102060 0.000000 0.000000 0.102060

Performance & Risk

Performance
Quarterly
As of
Monthly
As of
1 Month 3 Month YTD 1 Year 3 Years 5 Years 10 Years Since Inception

Performance data quoted represents past results. Past performance is no guarantee of future results and current performance may be higher or lower than the performance shown. Investment return and principal value will fluctuate, so your shares, when redeemed, may be worth more or less than their original cost.

Sales Charge and Expenses
The Fund's investment adviser has entered into an expense limitation agreement to limit the Fund’s total operating expenses (excluding the management fees paid to the Fund's adviser and sub-adviser and certain other expenses as described in the prospectus) so that such expenses do not exceed 0.68% of the Fund's average daily net assets through November 28, 2018.
Fees & Expenses
Gross Expense Ratio 0.76
Net Expense Ratio 0.71
The Fund's investment adviser has entered into an expense limitation agreement to limit the Fund’s total operating expenses (excluding the management fees paid to the Fund's adviser and sub-adviser and certain other expenses as described in the prospectus) so that such expenses do not exceed 0.68% of the Fund's average daily net assets through November 28, 2018.
Yields
Distribution Rate (as of 07/16/2018) 4.97
SEC Yields (as of 06/29/2018)
SEC Yield Subsidized: 5.29
SEC Yield Unsubsidized: 5.10

Premium/Discount
Number of Days Fund has Traded at a:
Discount Premium
Period Less than -2% -1.51% to -2.00% -1.01% to -1.50% -0.51% to -1.00% -0.01% to -0.50% 0.00% to 0.50% 0.51% to 1.00% 1.01% to 1.50% 1.51% to 2.00% Greater than 2%
2016-Q4: 12/5/2016 through 12/30/2016 0 0 0 0 13 6 0 0 0 0
2017-Q1: 1/3/2017 through 3/31/2017 0 0 0 0 54 8 0 0 0 0
2017-Q2: 4/3/2017 through 6/30/2017 0 0 0 1 61 1 0 0 0 0
2017-Q3: 7/3/2017 through 9/29/2017 1 0 0 0 41 20 0 0 1 0
2017-Q4: 10/2/2017 through 12/29/2017 0 0 0 4 53 6 0 0 0 0
2018-Q1: 1/2/2018 through 3/29/2018 0 0 0 17 41 3 0 0 0 0
2018-Q2: 4/2/2018 through 6/29/2018 0 0 6 20 30 8 0 0 0 0
Risk Considerations
Exchange-Traded Funds (ETF): The value of an ETF may be more volatile than the underlying portfolio of securities it is designed to track. The costs of owning the ETF may exceed the cost of investing directly in the underlying securities.
Credit & Interest: Debt securities are subject to various risks, the most prominent of which are credit and interest rate risk. The issuer of a debt security may fail to make interest and/or principal payments. Values of debt securities may rise or fall in response to changes in interest rates, and this risk may be enhanced with longer-term maturities.
ABS/MBS: Changes in interest rates can cause both extension and prepayment risks for asset- and mortgage-backed securities. These securities are also subject to risks associated with the repayment of underlying collateral.
High Yield-High Risk Fixed Income Securities: There is a greater level of credit risk and price volatility involved with high yield securities than investment grade securities.
Foreign & Emerging Markets: Investing internationally, especially in emerging markets, involves additional risks such as currency, political, accounting, economic, and market risk.
Bank Loans: Loans may be unsecured or not fully collateralized, may be subject to restrictions on resale and/or trade infrequently on the secondary market. Loans can carry significant credit and call risk, can be difficult to value, and have longer settlement times than other investments, which can make loans relatively illiquid at times.
Tax Liability: Noncompliant conduct by a municipal bond issuer, or adverse interpretations, could cause interest from a security to become taxable, subjecting shareholders to increased tax liability.
Market Price/NAV: At the time of purchase and/or sale, an investor's shares may have a market price that is above or below the fund's NAV, which may increase the investor's risk of loss.
Prospectus: For additional information on risks, please see the fund's prospectus.

Documents & Resources

Marketing Materials
Newfleet Dynamic Credit ETF Factsheet
Newfleet Monthly Sector Review
ETF Product Guide
Holdings
Positions BLHY
Financial Materials
Virtus Newfleet Dynamic Credit ETF (BLHY) Prospectus - November 28, 2017
Virtus Newfleet Dynamic Credit ETF (BLHY) SAI - November 28, 2017
Virtus ETF Trust II Annual Report | 2017
Virtus ETF Trust II Semi Annual Report

Please consider the investment objectives, risks, charges and expenses of the Fund carefully before investing. The prospectus contains this and other information about the Fund. Contact us at 1-888-383-0553 or visit www.virtus.com for a copy of the Fund's prospectus. Read the prospectus carefully before you invest or send money.

The Fund is an actively managed exchange-traded fund (“ETF”) and does not seek to replicate the performance of a specified index. The Fund may have a higher portfolio turnover than funds that seek to replicate the performance of an index.

Performance data quoted represents past results. Past performance is no guarantee of future results and current performance may be higher or lower than the performance shown. Investment return and principal value will fluctuate so your shares, when redeemed, may be worth more or less than their original cost.

Closing Price:
 The Closing Price is the price of the last reported trade on the fund's primary exchange. If there has been no reported trade for a particular date, the Closing Price represents the 4PM Bid/Offer Midpoint. 

4PM Bid/Offer Midpoint: The midpoint between the highest bid and the lowest offer on the listing exchange, as of the time that the Fund's NAV is calculated (usually 4:00pm Eastern Time).

Premium/Discount: The amount the Fund is trading above or below the reported NAV (based on 4PM Bid/Offer Midpoint).

The Fund is an exchange-traded fund (“ETF”). The “net asset value” (NAV) of the Fund is determined at the close of each business day, and represents the dollar value of one share of the Fund; it is calculated by taking the total assets of the Fund, subtracting total liabilities, and dividing by the total number of shares outstanding. The NAV of the Fund is not necessarily the same as its intraday trading value. Fund investors should not expect to buy or sell shares at NAV because shares of ETFs such as the Fund are bought and sold at market price (not NAV) and are not individually redeemed from the Fund. Thus, shares may trade at a premium or discount to their NAV in the secondary market. Brokerage commissions will reduce returns.

NAV returns are calculated using the Fund’s daily 4:00 p.m. NAV, and include the reinvestment of all dividends and other distributions (reinvested at the Fund's NAV on distribution ex-date). Market price returns are calculated using the 4:00 pm midpoint between the bid and offer, and include the reinvestment of all dividends and other distributions (reinvested at the 4:00pm bid/offer midpoint on distribution ex-date). Market price returns do not represent the return you would receive if you traded at other times.

SEC Yield is an annualized yield that is calculated by dividing the investment income earned by the Fund less expenses over the most recent 30 day period by the current NAV at the end of the 30 day period. The Subsidized Yield reflects fee waivers and/or expense reimbursements recorded by the Fund during the period. Without waivers and/or reimbursements, yields would be reduced. The Unsubsidized Yield does not adjust for any fee waivers and/ or expense reimbursements in effect. If the Fund does not incur any fee waivers and/or expense reimbursements during the period, the Subsidized Yield and Unsubsidized Yield will be identical.

Distribution Rate is the annual rate that an investor would receive if the most recent distribution remained the same going forward. The rate represents a single distribution from the Fund and does not represent total return of the Fund. The distribution rate is calculated by annualizing the most recent distribution and dividing it by the most recent NAV.

Returns for periods of less than one year are cumulative total returns.

Not insured by FDIC/NCUSIF or any federal government agency. No bank guarantee. Not a deposit. May lose value.

Distributed by ETF Distributors LLC