Touchstone Strategic Income ETF

Touchstone Strategic Income ETF (SIO) is an actively managed bond fund that looks for high income across US Treasuries, corporate bonds and asset-backed securities, and it can put up to 50% in junk bonds. Its trailing 12-month yield was 7.04% as of October 27, 2026, and it pays monthly. The trade-off is cost: its expense ratio is 0.50% after a fee waiver, against 0.03% for broad index funds such as AGG and BND.

• Over the year to Oct 27, 2026, SIO returned -0.1%, 2nd of 8 among similar funds.
• Its worst full calendar year was 2024 (+6.2%); its best was 2025 (+9.2%).
• The deepest fall in its price history was 6.9% (Aug 12, 2022 to Oct 20, 2022), recovered by Jan 6, 2023.

As of Jun 30, 2026, the fund held 216 securities; the ten largest made up 28.1% of assets, and 3.16% sat in cash and money-market holdings.

The bonds mature in 13.1 years on average (weighted by size), with an average coupon of 4.92%.

• Over the three months to Jun 30, 2026, investors added a net $25.1M (creations minus redemptions, per the N-PORT report).
• Monthly total returns reported for that quarter: +0.52%, +0.44%, +0.51%.

SIO does not track an index. Its sub-adviser, Fort Washington Investment Advisors, picks bonds one at a time and holds a fairly small number of issuers. It favors bonds that offer the most expected return for their downside risk, meaning what could happen to them in a recession rather than day-to-day price swings. At least 80% of assets go into income-producing bonds. At least 50% must be investment grade (bonds rated as lower credit risk). Up to 50% can be junk bonds, which are lower-rated and speculative. The fund can also hold up to 20% in emerging-market debt and up to 20% in stocks. The junk share tends to rise when credit spreads, the extra yield over Treasuries, are wide.

As of June 30, 2026, the fund held 219 positions from 216 issuers. Its largest holdings were Treasuries: the 4.125% note due 2036 (5.5%), the 4.75% bond due 2045 (4.8%) and the 3.75% note due 2028 (4.4%). The largest corporate bond was GM Financial at 0.8%. Asset-backed debt made up 19.6%, and the average maturity was 13.1 years.

There is no fixed rebalancing schedule. The manager sells a bond when its yield no longer pays enough for the risk. Turnover was 208%, so the portfolio changes heavily each year. The fund can also use futures, swaps and options to adjust its sensitivity to interest rates, but its two Treasury futures positions were tiny as of June 30, 2026.

• SIO charges 0.5% a year, versus an average of 0.1% for the similar funds below (8th of 8, cheapest first).
• Of that, 0.55% is the management fee; the rest covers other fund expenses.
• The fee includes a 0.32% waiver from the adviser, which may end.
• Using the prospectus's standard example, $10,000 invested would cost about $51 in the first year and $984 over 10 years (assuming a 5% annual return).

SIO pays monthly and seeks a high level of current income, with Treasuries making up a large share of the portfolio to support it.

SIO could serve as the income part of a bond allocation. Its trailing 12-month yield was 7.04% as of October 27, 2026, paid monthly. Its record is short. The fund launched on July 21, 2022, so it missed the 2008 and 2020 crashes and most of the 2022 bear market. Its deepest drop was 6.9%, from August 12 to October 20, 2022, and it had fully recovered by January 6, 2023, about 2.6 months later. Every full calendar year has been positive, and the weakest was 2024 at 6.09%, according to the prospectus. That record is calm, but its junk bonds and asset-backed debt have not yet been through a recession. Its 13.1-year average maturity also makes it sensitive to rising rates. It costs 0.50% a year, compared with a 0.10% average for similar funds. Past results don't predict the future, and a plan should look at the whole portfolio, not one fund.

Matched by bond funds with the closest average maturity and issuer mix (N-PORT).