Amundi Launches BBB Corporate Bond ETF

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.