Switzer Higher Yield fund relaunches as ETF
The Switzer Higher Yield fund has launched on the Chi-X Australia stock exchange as an exchange traded fund, managed by Coolabah Capital Investments.
The fund aimed to provide investors with an attractive cash yield and low capital volatility by investing in fixed income securities.
Marty Switzer, chief executive of Contango Asset Management, said the firm had decided to partner with active credit manager Coolabah to relaunch the fund as an exchange traded vehicle following investor demand.
The COVID-19 pandemic and resulting stockmarket volatility had re-focused people’s minds, he said, on the importance of diversification and including fixed income in a portfolio.
Coolabah portfolio management director, Ying Yi Ann Cheng, said: “The Switzer Higher Yield fund will actively invest in a diversified portfolio of Australian deposits, investment grade floating-rate notes and hybrid securities, targeting a weighted-average credit rating of ‘A-’, and near-zero interest rate duration risk.
color:#404040">
“Rather than chasing yield through assuming greater credit default risk, interest rate risk, or liquidity risk, Coolabah focuses on augmenting the portfolio’s yields through actively selecting cheap bonds that can potentially provide future capital gains.”
color:#404040">
AUTHOR
Laura Dew
Recommended for you
Infrastructure assets are well-positioned to hedge against global uncertainty and can enhance the diversification of traditional portfolios with their evergreen characteristics, an investment chief believes.
Volatility in US markets means currency is becoming a critical decision factor in Australian investors’ ETF selection this year.
Clime Investment Management is overhauling the selection process for its APLs, with managing director Michael Baragwanath describing the threat of a product failure affecting clients as “pure nightmare fuel”.
Global X will expand its ETF range of exchange-traded funds next month with a low-cost Australian equity product as it chases ambitions of becoming a top issuer of ETFs in Australia.
