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Invesco launches low-cost UK gilts ETFs

HM_TreasuryUS funds giant Invesco has launched two exchange-traded funds (ETFs) with what it claims to have the lowest-cost exposure to UK government bonds of any competing product in Europe.

The new ETFs offer investors the choice of short-term or broad exposure with one fund concentrating on gilts with maturities of 1-5 years and the other offering exposure across the full maturity spectrum of up to 55 years.

Both funds are sterling denominated and have ongoing charges of 0.06% a year.

Paul Syms, Invesco’s head of Emea ETF fixed income product management, said: “Investors, particularly in the UK, are faced with political uncertainty around Brexit, as well as more general questions about the economy, interest rates, currencies and equity markets.

“For investors who want to take some risk off the table, or simply diversify their portfolios, UK government bonds may offer an attractive solution.”

Each of the funds will invest directly in the constituents of the relevant Bloomberg Barclays UK Gilt Index, targeting a full replication.

Last week Invesco announced that its US Treasury bond Ucits ETF, launched in January on the London Stock Exchange, had raised over $1 billion (€883 million), becoming one of the firm’s fastest-growing ETFs ever to be launched in Europe.

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