BlackRock unveils US Treasury bond ETF in Europe

Sep 2nd, 2019 | By | Category: Fixed Income

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BlackRock has launched a new fixed income ETF in Europe, providing exposure to US Treasury bonds from across the yield curve.

BlackRock unveils US Treasury bond ETF in Europe

BlackRock unveils US Treasury bond ETF in Europe

The iShares $ Treasury Bond UCITS ETF has listed on Euronext Amsterdam in US dollars (GOVT NA) and on Deutsche Börse Xetra in euros (SNA2 GY).

The fund is linked to the ICE US Treasury Core Bond Index which covers fixed-rate US Treasury securities with maturities between one and thirty years and par amounts outstanding of at least $300 million.

Zero-coupon bonds, inflation-linked securities, Treasury Bills, and US government agency bonds are not eligible for selection.

The index is weighted by market value and rebalanced on a monthly basis.

The ETF comes with an expense ratio of 0.07%, placing the fund at the cheaper end of the fee scale for US Treasury ETFs in Europe.

The fund complements existing Treasury ETFs offered by BlackRock, including funds targeting specific ranges of the yield curve, namely the 0-1 year, 1-3 year, 3-7 year, 7-10 year, and 20+ year segments.

At seven basis points, the fund is very competitively priced. That said, investors can technically gain cheaper access to US Treasury bonds via ETFs offered by Invesco and Amundi. The Invesco US Treasury Bond UCITS ETF (TRES LN), which offers comparable all-maturity exposure, charges just at 0.06%, while the Amundi Prime US Treasury UCITS ETF (PRIT LN) leads the pack at just 0.05%.

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