New XTB models to simplify corporate bond exposure

The Australian Corporate Bond Company (ACBC) has today launched two XTB (exchange traded bond units) only model portfolios aimed at providing an efficient way for advisers to manage the direct investment fixed income part of their business and incorporate exposure to individual corporate bonds.

Since launching 13 months ago, $70 million worth of XTBs have traded on the ASX, with investors receiving direct exposure to returns from corporate bonds over blue-chip companies, including Telstra and National Bank of Australia (NAB).

The High Yield Model Portfolio, which was the first new XTB, was quantitative-based, with a qualitative overlay and consisted of a minimum of eight XTBs.

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The ACBC has also launched the Maturity Ladder Model Portfolio, which aimed to provide high return of capital from around five maturing XTBs on a yearly basis.

"Our XTB model portfolios have been developed in direct response to growing demand from advisers," ACBC chief executive and co-founder, Richard Murphy, said.

"Extraordinary market conditions are driving a growing need for higher-yielding, low volatility products, which makes the launch of our model portfolios especially timely."

The new XTB model portfolios are available from the ACBC, with Murphy stating that they will fill a gap in the market space and benefit customers looking for stable fixed income to ride out volatility.

"These new model portfolios should resonate with clients looking for a transparent and stable fixed income portfolio that offers regular and predictable income streams," he said.

"Our model portfolios make it easier for advisers to build corporate bond portfolios for clients."

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