Index provider IHS Markit, which has over $100bn in exchange-traded fund assets linked to its iBoxx range, has launched a suite of four new indices targeting the fixed income securities of companies engaged in infrastructure development. The Markit iBoxx Infrastructure indices track the performance of corporate bonds from firms in the energy, telecommunications, transportation and utilities sectors, while each references bonds with different currency denominations (US dollar, British pounds, euros, and US dollar high yield). The indices are suitable as underlyings for index-linked investment products such as exchange-traded funds.

Lyxor, Europe’s third largest provider of exchange-traded funds, has listed the Lyxor FTSE Actuaries Gilts 0-5Y (DR) UCITS ETF (GIL5) on the London Stock Exchange. The ETF is Lyxor’s first short-dated Gilt ETF and, at 0.07%, will be the cheapest of its kind in the market. This new exposure completes Lyxor’s range of gilts ETFs, giving investors the choice of short, all maturity or inflation linked gilts. Chanchal Samadder, Head of UK and Ireland ETF Sales at Lyxor, commented: “We have a clear ambition to be the number one choice for core fixed income ETFs. This isn’t just about lower fees, but providing the right exposures, and using the right replication. This new ETF means we can now offer low cost, simple exposure to both the long and short end of the gilts market.”

US-based exchange-traded fund provider VanEck has reduced the net expense ratio of the VanEck Vectors Fallen Angel High Yield Bond ETF (NYSE Arca: ANGL) from 0.40% to 0.35%. The ETF invests in ‘fallen angels’ – a term used to describe bonds that were rated as investment grade at the time of their original issuance, but which have since lost their investment-grade status. The fund may offer a value proposition to investors owing to research suggesting that fallen angels are often oversold prior to their downgrade to junk status. ANGL has delivered a strong performance in 2016, returning 13.7% through to 31 May based on net asset value.

Europe’s second largest provider of ETFs Deutsche Asset Management has expanded its ‘Yield Plus’ ETF range with the launch of the db x-trackers iBoxx EUR Corporates Yield Plus UCITS ETF (Xetra: XDEP) that provides exposure to the euro-denominated corporate bond market via the Markit iBoxx EUR Corporates Yield Plus Index. Martin Weithofer, Deutsche Asset Management’s Head of Strategic Beta, commented: “The strategic beta corporate bond index that our new ETF tracks offers a significant yield pick-up versus it’s non-yield plus equivalent, with moderately increased risk characteristics and almost identical duration.”

Leading European exchange-traded fund provider Lyxor has launched two new ETFs that provide investors with exposure to rising inflation expectations. The Lyxor USD 10Y Inflation Breakeven UCITS ETF (INFU) and Lyxor EUR 2-10Y Inflation Breakeven UCITS ETF (INFL) target the spreads between traditional bond yields and those of inflation-linked bonds, thus offering a pure play on inflation expectations without exposing the investor to changing interest rates. Francois Millet, Head of ETF and Index Product Development at Lyxor, commented: “Lyxor’s Breakeven UCITS ETFs gives investors exposure to the breakeven rate of inflation with the benefit of transparency and liquidity, thus turning it into a proper and investable asset class”.

Deutsche Asset Management has launched a new smart beta exchange traded fund that tracks emerging markets sovereign debt, while weighting its constituents according to the credit quality of the issuers. The db x-trackers iBoxx USD Emerging Sovereigns Quality Weighted UCITS ETF (XQUA) is launched on the London Stock Exchange and Deutsche Bourse. The new ETF tracks the Markit iBoxx USD Emerging Markets Sovereigns Quality Weighted Index. Martin Weithofer, Deutsche Asset Management’s Head of Strategic Beta, said in a statement: “For emerging markets… we found that the fundamental quality-weighted methodology can be useful in under-weighting countries prior to downgrades, which have often trailed fundamental underlying changes.”

Exchange-traded funds linked to Treasury Inflation-Protected Securities (TIPS) rallied following the recent Federal Reserve Open Market Committee meeting. Dovish tones from Fed officials suggest the central bank is now willing to tolerate higher inflation before tightening monetary policy more aggressively. The price of ten-year TIPS surged 1.7% following the release of details of the meeting, pushing the yield to a one-year low of 0.26%. The $16.2bn iShares TIPS Bond ETF (NYSE Arca: TIP), which tracks a range of inflation-protected US government bonds across the maturity spectrum, enjoyed its strongest weekly rally since March 2015.

Index provider Markit has released a report showing that assets under management (AUM) in fixed income exchange traded funds are increasing as a percentage of total AUM. The report, which investigates flows into ETFs across a range of asset classes, found that ETF providers capitalised on the trend by dedicating a greater proportion of fund launches with fixed income exposure. The report notes that global AUM for ETFs has risen by $130bn since the start of the year to 7 March 2016, driven by $35bn in net gatherings with the balance derived from price moves in underlying asset values.

Lyxor, Europe’s third largest provider of exchange-traded funds, has slashed the fees on a number of important UK and US bond ETFs, cutting total expense ratios (TERs) by as much as two-thirds in some cases. Through the firm’s ETFs, investors can now obtain exposure to gilts and Treasuries from as little as 0.07% and UK and US corporate bonds from 0.09%. Chanchal Samadder, Head of UK and Ireland ETF Sales for Lyxor, said: “We wanted to create a range of core fixed income exposures that are safe, liquid and low cost. These are staple, safe haven exposures in most portfolios and we wanted to give investors a better deal”.

iShares, the largest global exchange-traded fund provider by assets under management, has strengthened its range of fixed income ETFs with the launch of the iShares Euro Corporate Bond BB-B UCITS ETF (BBEB LN). The fund offers euro-denominated exposure to over 200 high yield corporate bonds with credit ratings between BB+ and B-.