Amundi Launches BBB Corporate Bond ETF

The fund tracks liquid investment grade corporate bonds that offer more yield for a lower rating  

RachaelRavesz_100x66.jpg
|
Editor, etf.com Europe
|
Reviewed by: Rachael Revesz
,
Edited by: Rachael Revesz

Amundi has expanded its range of fixed income exchange traded funds (ETFs) by launching a fund that tracks liquid corporate bonds with a slightly lower rating for higher yield.

The launch is the first ETF in Europe to track the Markit iBoxx EUR Liquid Corporates BBB Top 60 index, and has a total expense ratio of 0.20 percent. The ratings of the underlying bonds are either BBB- at Standard & Poor’s, BBB- at Fitch and Baa3 at Moody's.

A statement from Amundi said this fund would be suitable for investors looking for yield in the euro credit market as European issuers “still benefit from strong fundamentals and favourable environment with European Central Bank quantitative easing.”

Valerie Baudson, CEO at Amundi ETF, indexing and smart beta, said: “We are delighted to provide investors with this unique yield enhancing tool in the investment grade universe, with lower risk than in the high yield universe.”

Fixed income ETFs now stand at over $500 billion of assets thanks to strong flows into high yield and investment grade corporate debt in October, according to data from BlackRock, as the Fed halting rates in the U.S. has triggered investors to take on more risk.

Amundi has launched several ETFs this year, including Europe’s first local buyback ETF for 0.30 percent fees in September, and the region’s first USD-denominated floating rate note ETF in May for 0.18 percent fees.

 

Rachael Revesz joined etf.com in August 2013 as staff writer. Previously an investment reporter at Citywire, she has a background in writing content for retail financial advisors and has covered a wide range of subjects in finance. Revesz studied journalism at PMA Media, which has since merged with the Press Association. She also holds a B.A. in modern languages from Durham University, as well as CF1 and CF2 financial planning certificates from the CII.