BetaShares launches new bond ETF
BetaShares has launched the Australian Investment Grade Corporate Bond (CRED) exchange-traded fund (ETF), which would offer investors access to the Australian corporate bond market.
The fund would provide exposure to a portfolio of investment-grade, fixed-rate Australian corporate bonds and would aim to provide an income, paid monthly, which would be expected to exceed the income paid on cash, term deposits, government and composite bond exposure, the firm said.
At as 31 May, the portfolio of bonds in the index tracked by CRED provided a yield-to-maturity of around four per cent per annum versus a yield-to-maturity of 2.6 per cent per annum from the benchmark Australian Composite Bond Index and the current RBA cash rate of 1.5 per cent per annum.
According to the firm, it would also be the lowest-cost Australian fixed-rate corporate bond ETF currently available on the Australian Securities Exchange (ASX) (at 0.25 per cent per annum).
BetaShares managing director, Alex Vynokur, said that the launch of the new ETF responded to investors’ continued demand for fixed-income ETFs, a market which received over $360 million of inflows in the first four months of this year.
“We believe Australian corporate bonds have an important place in investors’ portfolios,” Vynokur said.
“CRED provides this access in a simple, cost-effective way, with the additional liquidity benefit of an exchange-traded fund.”
AUTHOR
Oksana Patron
Recommended for you
The alternative investment manager has signalled its intentions to repackage an existing fund into a second private equity vehicle, targeting both listed and unlisted opportunities.
The acquisition of Mason Stevens by Adamantem Capital has reached completion, as the wealth platform looks to increase investment into its services for Australian wealth practices.
Platinum Asset Management and VanEck have both announced name changes to multiple of their ETFs to clarify their complexity.
Active ETFs are gaining traction in Asia-Pacific as wealth managers seek to blend the low-cost fees of passive with active management.
