SSgA launches first European ETF to provide short maturity EM bond exposure

Nov 14th, 2014 | By | Category: Fixed Income

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State Street Global Advisors, the asset manager behind the SPDR ETFs brand, has announced the launch of the SPDR BofA Merrill Lynch 0–5 Year EM USD Government Bond UCITS ETF (ZPR5).

SSgA launches first European ETF to provide short maturity EM bond exposure

Alexis Marinof, head of SPDR ETFs EMEA.

The Deutsche Börse-listed ETF is the first European ETF to provide exposure to short maturity emerging market bonds in hard currency.

It is linked to the BofA Merrill Lynch 0–5 Year EM USD Government Bond ex-144a Index, an index reflecting the performance of short-maturity emerging market government debt issued in US dollars.

The fund opens up a new segment of the emerging market bond universe for investors wanting to lower the duration or the volatility of their existing hard currency emerging market debt investments. Investors can also increase the yield of their existing US dollar short maturity investments.

Commenting on the launch, Alexis Marinof, head of SPDR ETFs EMEA, said: “This new ETF captures the global investment universe of short maturity emerging market bonds and adds to our existing emerging market fixed income capabilities.”

He continued: “It allows investors to reduce the duration of their existing emerging market debt exposure or increase the yield of the US dollar portion of their portfolio, while giving them full transparency of their holdings on a daily basis.”

There are now 60 SPDR ETFs available across Europe. This latest launch follows the introduction of the world’s first passive global convertible bond ETF, the SPDR Thomson Reuters Global Convertible Bond UCITS ETF (ZPRC), which commenced trading on the London Stock Exchange and Deutsche Börse in October.

Globally, SSgA manages more than $415 billion in over 220 ETFs worldwide.

The new fund has a total expense ratio of 0.42%.

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