BetaShares Australian Composite Bond ETF (ASX: OZBD) has launched on the ASX and is designed to be a core portfolio allocation for fixed income.
BetaShares OZBD aims to track the Bloomberg Australian Enhanced Yield Composite Bond Index, before fees and expenses. This index takes an intelligent investment approach by weighting bonds on the basis of their risk-adjusted income potential rather than debt-weighting, aiming to provide investors with higher returns than the most commonly used Australian fixed income benchmark, the AusBond Composite Index (AusBond). OZBD aims to maintain an overall duration and credit profile that is similar to that of the AusBond index.
BetaShares CEO Alex Vynokur said OZBD offered a convenient and cost-effective way to invest in a diversified portfolio of high-quality Australian corporate and government bonds.
“OZBD has been designed to be a core portfolio allocation for fixed income for Australian investors and their advisers. OZBD’s intelligent investment approach seeks to avoid the shortcomings of traditional debt-weighted indices and aims to provide higher returns.”
“The Fund’s focus on income is particularly pertinent in a rising yield environment.”
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BetaShares OZBD’s Index has historically outperformed the AusBond over the long-term and in each of the past ten financial years, and is offering a yield-to-maturity that is 0.65% p.a. higher than this index as at 31 January 2021.
BetaShares OZBD management costs are 0.19% p.a. (or $19 per year for every $10,000 invested).
BetaShares is an Australian fund manager specialising in exchange traded funds (ETFs) and other Funds traded on the Australian Securities Exchange (ASX).
More information about OZBD can be found on the BetaShares website here.
