Betashares has announced the expansion of its range of fixed income investment solutions with the launch of the Betashares Australian Enhanced Credit Income Complex ETF (ASX: ECRD).
ECRD is designed to provide investors with a higher level of income than traditional bond funds and hybrids, while maintaining a volatility profile similar to hybrids. The Fund achieves this goal by investing in a portfolio of high-quality floating rate subordinated bonds issued by Australia’s ‘big 4’ banks and interest rate-hedged Australian investment grade corporate bonds, with yields enhanced through gearing at institutional borrowing rates. Currently, ECRD provides a running yield of 7.68% p.a., paid monthly*.
Betashares said cash and fixed income ETFs have remained front of mind for investors. Since the start of the year, the category has received nearly $11 billion in inflows, significantly higher than the $6.4 billion received last year. Betashares has long prioritised providing access to institutional grade cash and fixed income investment solutions. It said as a result, the fund manager has maintained its leadership position in the provision of cash and fixed income ETFs in Australia after recently surpassing $15 billion in funds under management in the asset class and year to date seeing the largest flows in the industry to its range.
Betashares CEO Alex Vynokur said the launch represents the firm’s ongoing commitment to improving access to sophisticated income solutions for Australian investors and their financial advisers.
“Our growing range of robust fixed income solutions continues to help investors build stronger portfolios and meet their income goals,” Vynokur said.
Also read: Flexible Credit Income Fund Launched For Australian Investors
“Against a backdrop of bank hybrids being phased out and dividend yields on shares trending lower, ECRD offers a timely and compelling addition to our range of income solutions. By combining high-quality Australian investment grade bonds that have exhibited attractive risk-adjusted returns with a structure that enhances income potential, we’re giving investors the opportunity to boost income without taking on equity risk.”
*yield may vary at time of investment.
