Deutsche Asset Management has added an exchange-traded fund (ETF) providing US dollar corporate bond exposure to its suite of Xtrackers ETFs.
The iBoxx USD Corporate Bond Yield Plus Ucits ETF1 listed this week on the London Stock Exchange after listing on Frankfurt’s Deutsche Börse last Friday.
The fund provides exposure to the highest-yielding investment-grade bonds that broadly constitute the US dollar investment-grade corporate bond market.
The ETF focuses on the top 33%, ranked by yield, of bonds that make up the Markit iBoxx USD Corporates Index.
“Investors looking for strategic bond investments that improve the risk and return profile of their portfolios may be attracted to our new ETF as it can generate a yield pick-up for currently little additional risk,” said Olivier Souliac, strategic beta fixed income specialist at Deutsche AM.
“It achieves this by extracting exposure to higher corporate risk premia, from a broader investment-grade corporate bond index, and keeping lower interest rate exposure than traditional ETFs.”
The new ETF, which has an annual all-in fee of 0.25% and is a physical replication ETF, complements Deutsche’s existing range of “yield plus” Xtrackers providing exposure to euro corporate bonds and eurozone government bonds.
Deutsche’s Xtrackers range of ETFs currently has over €1.5 billion in assets under management. Deutsche AM had €702 billion of assets under management as of December 31, 2017.
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