BetaShares has launched its latest fixed income exchange traded fund (ETF), focusing on global government bonds.
The BetaShares Global Government Bond 20+ Year ETF – Currency Hedged would give investors exposure to long-dated sovereign bonds.
The bonds would be high credit quality with 40% rated AAA and an average portfolio rating in the fund of AA. To be eligible, the bonds must have a remaining term to maturity of more than 20 years which further enhanced the fund’s defensiveness and diversification.
Government bonds were particularly relevant given the quantitative easing programmes embarked on by central banks as a method of supporting the economy during the COVID-19 pandemic.
BetaShares’ chief executive, Alex Vynokur, said: “We are excited to be able to give Australian investors the chance to invest in a diversified portfolio of high-quality global sovereign bonds. In previous sharemarket downturns, government bonds historically have tended to rise in value.
“Our new fund makes the process of investing in global government bonds simple and cost-effective. It offers a robust option for gaining exposure to an important portfolio building block for investors seeking regular income, as well as a high-quality tool to defend portfolios.”
The ETF intended to pay quarterly income and had managements costs of 0.22% per annum.