F/m Investment's ZTOP ETF Targets More Stable Junk Bonds In A Risky Market

In a still-uncertain interest rate environment and ongoing credit worries, F/m Investments launched a new high-yield bond ETF that seeks to put stability ahead of stretch.

The F/m High Yield 100 ETF ZTOP, which started with $50 million in seed capital, seeks to avoid some of the risks embedded in conventional junk bond funds by concentrating on the sector’s biggest and most liquid issuers.

ZTOP follows the Bloomberg U.S. High Yield Top 100 Quality Select Equal Weighted Index and has an expense ratio of 0.39%.

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The debut arrives as older high-yield ETFs — typically constructed using broad market sampling — have come under fire for exposing investors to riskier corners of the corporate debt market, particularly during times of expanding credit spreads.

John Han, portfolio manager of ZTOP, said that high-yield has evolved, but the weapons many investors have at their disposal haven’t. A more focused strategy such as ZTOP can provide improved downside protection while still generating income.

F/m says the fund was created following chronic underperformance by conventional high-yield ETFs, a number of which have been unable to replicate the benchmarks they are intended to represent. ZTOP uses a rules-based, equal-weight methodology and invests solely and continuously in the 100 best names in the U.S. high-yield universe, sorted by size and liquidity.

The ETF arrives as part of F/m's growing fixed income lineup, which includes the U.S. Benchmark Series ETFs and the Ultrashort Treasury Inflation-Protected Security ETF RBIL, which was launched in February 2025. The firm has drawn attention for packaging institutional-style strategies into low-cost, easily accessible ETF wrappers.

ZTOP may be attractive to allocators and advisors seeking high-yield exposure less susceptible to credit shocks.

With fixed income allocations squarely back in the crosshairs of investors in 2025, ZTOP’s launch contributes to the changing arsenal of tools at the disposal of yield-starved investors — this time with an added filter.

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