Peak Financial Advisors Redirects $15 Million Into Active Bond Strategy, Exits Fallen Angel Play

Peak Financial Advisors has made a strategic pivot in its fixed income allocation, deploying approximately $15 million into the JPMorgan Active Bond ETF (NYSE: JBND) while simultaneously trimming exposure to higher-risk credit recovery plays. The move signals a tactical reassessment of market conditions and risk appetite in the current rate environment.

The Capital Redeployment Decision

In a 13F filing dated January 12, Peak Financial Advisors established a new position comprising 278,276 shares of JBND, representing an estimated $15.05 million investment based on quarterly average pricing. This allocation now comprises 6.6% of the firm’s 13F reportable assets under management as of December 31.

The timing of this deployment is notable—it coincides with the fund’s exit from fallen angel bond exposure in the same quarter. This transition suggests Peak is shifting from a credit recovery beta play to a more systematic, security-selection-driven approach.

Portfolio Context: Where JBND Ranks

Following this investment, JBND entered Peak’s top holdings, though it remains below their largest positions:

• FLXR: $25.43 million (11.4% of AUM)
• MTBA: $18.88 million (8.5% of AUM)
• GLDM: $17.14 million (7.7% of AUM)
• CTA: $15.90 million (7.1% of AUM)
• EMB: $11.42 million (5.1% of AUM)

The diversification across multiple fixed-income and commodity-linked vehicles reflects a multi-faceted income generation strategy.

Understanding the Rotation Strategy

Fallen angel ETFs typically thrive in early-cycle recoveries when credit spreads compress and upgrade cycles accelerate. By exiting this exposure, Peak appears to be locking in gains from that thesis rather than waiting for diminishing returns. The timing suggests the most attractive risk-reward in credit recovery has already been captured.

The shift to JBND represents a fundamentally different bet. Rather than banking on credit recovery, this strategy emphasizes:

• Duration management: JBND maintains an average duration slightly above six years, providing meaningful rate sensitivity without excessive maturity risk
• Security selection: Active portfolio construction across Treasuries, securitized credit, and corporate bonds
• Yield balance: At 4.4%, the fund targets returns above the Bloomberg U.S. Aggregate Bond Index without excessive yield-chasing

Performance Metrics and Fund Mechanics

As of market close on January 12, JBND traded at $54.07, representing a 3.0% decline from its 52-week high but a 5% gain over the trailing 12-month period. Key fund metrics include:

• Total assets under management: $5.44 billion
• Current yield: 4.4%
• 1-year total return: 8%
• Investment objective: Outperform the Bloomberg U.S. Aggregate Bond Index over a three to five-year cycle

The fund maintains at least 80% of assets in bonds, with its active management process and credit research driving portfolio construction. Since its late 2023 launch, JBND has delivered risk-adjusted returns exceeding its benchmark across both absolute and risk-adjusted measures.

What This Reallocation Reveals

Peak’s decision underscores a broader market narrative: the easy credit recovery gains have been realized, and sophisticated allocators are repositioning toward more balanced, defensively-oriented income strategies. By moving capital from fallen angel recovery plays to an actively managed core bond fund, Peak is effectively trading tactical upside for systematic downside management and income consistency—a posture increasingly appropriate as interest rate trajectory uncertainty persists.

For investors monitoring institutional moves, this allocation shift demonstrates how professional managers are navigating the current bond market environment through both tactical exits and strategic shifts in underlying strategy.