Natixis affiliate IML has launched an active ETF aimed at retirees and income-focused investors, while Loftus Peak has unveiled a hedged version of its global disruption ETF.
The IML Equity Income – Complex ETF (EQIN) will offer access to steady income by investing in stocks with sustainable and growing dividends and take advantage of stockmarket volatility to enhance this income.
It is based on the firm’s existing managed fund which has been running for 14 years and achieved an average annual income of 9.4 per cent including franking.
The decision to launch an ETF version is driven by the substantial volume of assets expected to transition into the pension phase in the coming years where investors will be seeking income.
Michael O’Neill, IML portfolio manager, said: “It’s becoming harder and harder for people to get consistent income to fund their retirements with interest rates and ASX dividend yields falling (particularly for banks and resources sectors), and bank hybrids being phased out. This fund fills that gap for retirees, giving them consistent income with lower volatility that they can rely on.”
Meanwhile, Loftus Peak has listed a hedged version of its Global Disruption ETF as an active ETF to provide investors with a global equity strategy that has the ability to hedge foreign currency exposure back to Australian dollars.
Listed on the ASX on 01 September, the Global Disruption Hedged Active ETF (LPHD) will offer access to growing market segments, exposure to high-quality companies with structural growth and global diversification of between 15 and 35 securities.
It was originally run as an unlisted fund launched in July 2022 but is now available in dual-access format. This is a hedged version of Global Disruption ETF which was listed in 2016 and is $662 million in size.
Rick Steele, chief executive of Loftus Peak, said: “Given the underlying investments of the fund are exposed to foreign currencies, primarily the US dollar, the Loftus Peak Global Disruption Hedged Active ETF provides share market investors a strategic way to achieve a minimised currency risk, while participating in a growth opportunity. This launch means we now offer the full suite of products across our global disruption strategy; currency hedged or unhedged and each accessible by way of the ASX or the fund’s administrator.”
Last month, Money Management covered how hedged ETFs are seeing greater flows than usual as Australian investors navigate market turmoil in the US.
For example, the iShares S&P 500 (AUD Hedged) ETF attracted nearly $500 million in net flows, compared to iShares S&P 500 (AUD Unhedged) ETF which saw around $200 million, surpassing the unhedged fund for the first time this year.
Speaking with Money Management, iShares ETF and index investments specialist at BlackRock, Tamara Haban-Beer Stats, said the strong inflows into hedged USD-denominated ETFs suggest that Australian investors are seeking to lock in currency-hedged positions across asset classes in response to a weakening US dollar.
