State Street launches fixed income ETFs
State Street Global Advisers has launched two new fixed income exchange-traded funds (ETFs) that give retail investors easier access to Australian government, semi-government and corporate bonds, State Street head of SPDR ETFs in Australia, Amanda Skelly said.
The SPDR S&P/ASX Australian Bond Fund and SPDR S&P/ASX Australian Government Bond Fund are the first ETFs to track indices from the S&P/ASX Australian Fixed Income Index Series, State Street stated.
The S&P/ASX Australian Government Bond Index is 53.1 per cent government bonds and 46.9 per cent semi-government bonds, while the S&P/ASX Fixed Interest Index is 36.3 per cent government bonds, 32 per cent semi-government bonds, 21.5 per cent supranational/sovereign bonds and 10.2 per cent corporate bonds.
Skelly said the funds offer investors diversification in "a low-cost, easily tradeable and transparent manner".
"The advent of fixed income ETFs this year marks a milestone for retail investors - especially those seeking to add more stability to their self-managed super fund - as they offer simple, safe and transparent access to high quality fixed income assets which generate a regular and largely predictable income stream," she said.
State Street's Asia-Pacific head of fixed income Kheng-Siang Ng said the AAA rating of Australian government bonds and their popularity with foreign investors should assure good future yields.
State Street beefed up its ETF business earlier this month with Skelly's appointment and also appointed Shaun Parkin to lead wholesale ETF sales.
Recommended for you
Australia’s “sophisticated” financial services industry is a magnet for offshore fund managers, according to a global firm.
The latest Morningstar asset manager survey believes ETF providers are likely to retain the market share they have gained from active managers.
Negative market movements, coupled with net outflows, have prompted a near $6 billion decline in Challenger’s funds under management for FY25’s third quarter.
The real estate investment manager has positioned the APAC region for future growth with an internal promotion to the newly created role of deputy head of Asia Pacific.
