Peak Financial Advisors Pivots to Active Bond Strategy, Exits Fallen Angel Positions

A Strategic Rotation in the Fixed Income Space

In a telling move that reflects shifting market sentiment, Peak Financial Advisors revealed significant portfolio repositioning in recent disclosures. The firm established a substantial new position in the JPMorgan Active Bond ETF (JBND), committing approximately $15.05 million through 278,276 shares acquired during the latest quarter. This allocation now represents 6.6% of the firm’s 13F reportable assets under management.

But here’s what makes this notable: simultaneously abandoning its fallen angel exposure signals a clear change in tactical thinking about the fixed income landscape.

Understanding the Strategic Shift

The transition reveals more than just rebalancing. Fallen angel ETFs typically thrive early in market cycles, banking on credit recovery and spread compression as downgrades stabilize. Peak’s decision to exit this positioning—while it simultaneously built a core position in JBND—suggests the fund manager believes the easy gains from credit normalization have already been captured.

This is a move from recovery-focused beta trades toward a more sophisticated approach centered on active security selection and duration management. Rather than chasing yield spread compression, Peak is now emphasizing downside protection and tactical bond allocation.

What JBND Brings to the Table

JBND operates with a fundamentally different mandate than fallen angel strategies. The ETF pursues outperformance versus the Bloomberg U.S. Aggregate Bond Index through active management of a diversified bond portfolio. Key metrics as of January 12:

• Fund Size: $5.44 billion in AUM
• Yield: 4.4%
• 1-Year Total Return: 8%
• Share Price: $54.07 (down 3.0% from 52-week highs, but up 5% year-over-year)

The fund maintains minimum 80% exposure to bonds and manages an average duration just exceeding six years—positioning it squarely in the middle of the investment-grade landscape. Since launching in late 2023, JBND has outperformed its benchmark on both absolute and risk-adjusted metrics, driven by active positioning across Treasuries, securitized credit, and corporates.

Portfolio Context: Where JBND Fits

Following this transaction, Peak Financial Advisors’ top holdings reflect a diversified, income-oriented approach:

• 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 new JBND position slots into this framework as a core fixed income engine, complementing satellite allocations across specialized bond strategies and other asset classes.

The Bigger Picture for Bond Investors

Peak’s repositioning reflects a broader market evolution. When fallen angel trades worked best—early cycle recoveries with strong technical backdrop—the playbook was straightforward: capture credit normalization as companies stabilized. But as that cycle matures, the low-hanging fruit diminishes.

The shift toward active bond management prioritizes a different set of skills: macro positioning, sector rotation, and security selection in a potentially more challenging environment. JBND’s track record since inception suggests this approach has merit, particularly if markets face headwinds that favor defensive positioning and tactical flexibility over simple spread compression bets.

For investors watching portfolio manager moves, this $15 million commitment signals confidence in active bond management as a foundational strategy—while simultaneously indicating skepticism about further fallen angel upside in the near term.