Investment Manager Makes Strategic Buy in Fixed Income ETF, According to Recent Filing
Key Points
Initiated 303,893 shares in FALN; trade value was $8,442,148 according to SEC filing
FALN position represents 5.07% of Gimbal Financial's reportable AUM
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On Nov. 4, 2025, Gimbal Financial disclosed a new position in iShares Fallen Angels USD Bond ETF (NASDAQ:FALN), acquiring 303,893 shares for an estimated $8.44 million.
What Happened
Gimbal Financial opened a new position in iShares Fallen Angels USD Bond ETF during the third quarter, according to an SEC filing dated Nov. 4, 2025. The fund purchased 303,893 shares, with a transaction value of $8,442,148. This addition brought the total number of reportable positions in the fund to 55.
What Else to Know
This filing reflects a new position in FALN, representing 5.07% of Gimbal Financial's 13F reportable assets under management as of Sept. 30, 2025.
Top holdings after the filing:
- IVV: $26.48 million (15.9% of AUM)
- ICLN: $17.59 million (10.6% of AUM)
- RPG: $16.99 million (10.2% of AUM)
- XMMO: $16.85 million (10.1% of AUM)
- IYC: $16.61 million (10.0% of AUM)
As of Nov. 3, 2025, FALN shares were priced at $27.34, up 2.01% over the prior year; shares have underperformed the S&P 500 by 11.86 percentage points.
The ETF had an annualized dividend yield of 6.24% as of Nov. 4, 2025, and was 1.75% below its 52-week high.
ETF Overview
| Metric | Value |
|---|---|
| Price (as of market close Nov. 3, 2025) | $27.34 |
| Dividend yield | 6.24% |
| 1-year total return | 9.07% |
ETF Snapshot
iShares Fallen Angels USD Bond ETF (FALN) provides exposure to a diversified portfolio of U.S. dollar-denominated corporate bonds that have been downgraded from investment grade to high yield status. The fund's strategy seeks to exploit potential price dislocations and recovery opportunities associated with credit rating transitions. With a market capitalization of $1.84 billion and a dividend yield of 6.24%, FALN offers exposure to high yield corporate bonds for investors seeking enhanced yield and credit diversification.
Investment strategy targets U.S. dollar-denominated high yield corporate bonds that were previously rated investment grade ("fallen angels"), seeking to capture value from credit rating downgrades.
The portfolio is composed primarily of high yield bonds, with at least 80% of assets invested in index components and at least 90% in eligible fixed income securities.
Foolish Take
The iShares Fallen Angels USD Bond ETF (FALN) might be an unfamiliar name to average investors, but, for many investors, it is worth getting to know this fund.
In short, this is a fixed-income ETF that specializes in corporate bonds. Specifically, the fund targets the bonds of companies that have recently been downgraded from investment grade to junk status. By doing so, the fund can often acquire the bonds at a steep discount, then hold them to maturity, collecting interest payments along the way, while also hopefully benefiting from price appreciation of the bonds if the company's credit rating stabilizes.
This strategy has paid off, based on the fund's performance history. Over the last three years, the fund has generated a total return of 37%, with a compound annual growth rate (CAGR) of 11%. That's an excellent return for a fixed-income ETF, and it is even better than funds within the category, such as the iShares iBoxx $ High Yield Corporate Bond ETF (HYG), which has generated a total return of 32% over the same period and a CAGR of 9.8%.
In summary, for investors seeking income from their portfolio, the FALN ETF is a name to consider given its proven strategy and solid performance history.
Glossary
ETF (Exchange-Traded Fund): An investment fund traded on stock exchanges, holding a basket of assets like stocks or bonds.
Fallen Angels: Bonds originally rated investment grade that have been downgraded to high yield (junk) status.
High Yield Bonds: Bonds rated below investment grade, offering higher interest rates due to greater credit risk.
Investment Grade: A credit rating indicating a relatively low risk of default, typically BBB-/Baa3 or higher.
Credit Rating Downgrade: A reduction in a bond's or issuer's credit rating, reflecting increased risk of default.
Assets Under Management (AUM): The total market value of assets managed by a financial institution or fund.
13F Reportable Assets: Securities holdings that institutional investment managers must disclose quarterly to the SEC under Form 13F.
Dividend Yield: Annual dividends paid by an investment, expressed as a percentage of its current price.
Total Return: The investment's price change plus all dividends and distributions, assuming those payouts are reinvested.
Credit Diversification: Spreading investments across issuers or sectors to reduce exposure to any single credit risk.
Index Components: The individual securities that make up a financial index tracked by a fund.
Fixed Income Securities: Investments, such as bonds, that provide regular interest payments and return of principal at maturity.
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Jake Lerch has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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