Source, Ashmore partner to launch actively managed EM bond ETFs

Oct 7th, 2014 | By | Category: Fixed Income

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Source, one of Europe’s leading providers of exchange-traded funds, and Ashmore, the specialist emerging markets investment manager, have partnered to launch a pair of ETFs that offer actively managed exposure to emerging market bonds.

Source, one of Europe’s leading providers of exchange-traded funds, and Ashmore, the specialist emerging markets investment manager, have partnered to launch a pair of ETFs that offer actively managed exposure to emerging market bonds. Michael John Lytle, Chief Development Officer at Source, commented: “Ashmore is one of the very few managers solely dedicated to emerging markets and with a very long and successful track record. Investors will now be able to access their expertise in active management while benefiting from the intra-day trading, liquidity and increased transparency of Source’s ETF structure.”

Michael John Lytle, Chief Development Officer, Source.

The new ETFs are share classes of existing Ashmore funds, the Ashmore SICAV Emerging Markets Total Return Fund and Ashmore SICAV Emerging Markets Corporate Debt Fund, both of which seek to achieve a high level of total return over the medium term.

The total return fund is mainly invested in fixed income instruments issued by emerging market sovereigns, quasi-sovereigns and corporate entities in various currencies. The fund provides an active approach to allocating between different bond sectors and currency denominations, aiming to take advantage of opportunities that arise throughout the market cycle.

The corporate debt fund is mainly invested in fixed income instruments issued primarily by emerging market private and public sector corporate entities in various currencies. The fund provides more focused exposure to the corporate bond sector, where spreads over the developed market corporates are at attractive levels.

Commenting on the partnership, Michael John Lytle, Chief Development Officer at Source, said: “Investors wanting to diversify and pick up additional yield are looking beyond developed markets. Ashmore is one of the very few managers solely dedicated to emerging markets and with a very long and successful track record. Investors will now be able to access their expertise in active management while benefiting from the intra-day trading, liquidity and increased transparency of Source’s ETF structure.”

Christoph Hofmann, Global Head of Distribution at Ashmore, added: “Despite their huge potential, strong growth prospects and favourable fundamentals, emerging markets remain significantly under-represented in most investors’ global asset allocation. As an active manager with over 20 years’ experience in emerging markets, a key objective is to make the wealth of emerging market opportunities more readily available. We are therefore delighted to partner with Source to provide investors with an additional easy and efficient way to access our existing mutual fund strategies through an actively managed ETF share class.”

The funds are listed on the London Stock Exchange and are available in USD.

Ashmore SICAV Emerging Markets Total Return Fund – Ashmore Source UCITS ETF (ATRF)
Management fee 1.10%

Ashmore SICAV Emerging Markets Corporate Debt Fund – Ashmore Source UCITS ETF (ACDF)
Management fee 1.15%

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