The ETF has been dubbed ‘db x-trackers Barclays USD Corporate Bond UCITS ETF’. It tracks the Barclays USD Liquid Investment Grade Corporate Index.
This index comprises almost 1500 bonds, over 80% of which have been issued by US-domiciled companies. The ETF is listed on the Deutsche Börse and will shortly list on the London Stock Exchange.
The average credit rating of bonds in the index is investment grade, while the current index yield is 3.69%. The ETF is physically replicating and has a fee of 0.2% per annum.
“With yields on many short maturity major government bonds now in negative territory, which means investors are effectively paying to own these bonds, there is a demand for fixed income exposure that generates a reasonable yield,” said Michael Mohr, head of exchange-traded product development at Deutsche AWM. “Our new US dollar corporate bond ETF helps meet that demand.”
By the end of August this year fixed income ETFs globally had generated almost USD 52.8bn in inflows year-to-date, Deutsche AWM said.
