VanEck FLOT ETF (ASX:FLOT)

VanEck Australian Floating Rate ETF

About the FLOT ETF

FLOT ETF is managed by VanEck and is designed to give investors exposure to a diversified portfolio of Floating Rate Notes (FRNs) which represent the Bloomberg AusBond Credit FRN 0+ Yr Index.

The Bloomberg AusBond Credit FRN 0+ Yr Index (BAFRN0) is a market value weighted index comprising floating rate bonds that are of investment grade quality. The index typically includes bonds issued by corporate entities such as the four largest banks in Australia, foreign banks, other lending institutions and Australian listed property trusts (A-REITs).

FLOT ETF's investments (FRNs) pay coupons (interest) that varies with short-term interest rates.

FLOT ETF Performance Review

4.83

1.97

2.04

2.12

5.22

4.73

Data Current To: 31/12/2023

Our review of FLOT ETF

A portfolio of senior, investment grade corporate bonds with a very high credit quality

More than 92% of bonds are rated in the A range or above

The ETF consists of 100% floating rate bonds, there is a very small exposure to interest rate risk

Must have a minimum outstanding face value of $100 million and minimum one month until maturity

Australian dollar denominated securities but also invests in financial bonds from other countries

What we like about the FLOT ETF

Good diversification with over 200 securities

Takes minimal interest rate risk

Short average term to maturity of around 2 years and modified duration of 0.12 years as at 31 December 2022

Things to be aware of about the FLOT ETF

Concentrated, with around 96% of securities in the financial sector and 64% in Australia

FLOT ETF Investment Strategy

FLOT invests in a diversified portfolio of Australian dollar denominated Floating Rate Notes with the aim of providing investment returns (before fees and costs) that closely track the returns of the Bloomberg AusBond Credit FRN 0+ Yr Index

What does the FLOT ETF Invest In?

FLOT is a Corporate Bond ETF.

The FLOT ETF holds about 234 different FRN investments including securities issued by Commonwealth Bank of Australia, National Australia Bank and Westpac Banking Corp. Over 95% of FLOT ETF's are in the banking sector and more than 60% are in Australia. More than 80% of investments are rated single A or above.

FLOT ETF Credit Quality

The average credit quality of the FLOT ETF is AA-.

A detailed breakdown of the credit quality is expressed below.

FLOT Frequently Asked Questions

What index does the FLOT ETF aim to replicate?

The FLOT ETF aims to replicate the Bloomberg AusBond Credit FRN 0+ Yr Index.

How often does FLOT ETF pay distributions?

The distribution frequency of FLOT is Monthly.

When did the FLOT ETF start?

The inception date of the FLOT ETF was 01/07/2017.

What are the net assets of the FLOT ETF?

FLOT has net assets of $689m (AUD) as of 31/12/2023.

What are the number of holdings in the FLOT ETF?

Total number of holdings in FLOT is 196 as of 31/12/2023.

What are the management fees for the FLOT ETF?

The annual management fees for the FLOT ETF are 0.22% p.a. Learn more about ETF fees in this article.

How can I invest in the FLOT ETF?

FLOT is an Exchange Traded Fund, and units may be bought or sold on the ASX like shares. Learn how to buy and sell ETFs in this article.

Does the FLOT ETF have a minimum investment amount?

No, there is no minimum to invest in the VanEck FLOT ETF. Exchange Traded Funds in general do not have a minimum investment amount required by the issuer. However, if you choose to invest through a broker, they may choose to set their own minimum investment amount.

Are there any performance fees associated with the FLOT ETF?

No, FLOT has no performance fee. This is one of the advantages of Exchange Traded Funds, as they are traded like shares, you’ll generally only pay a commission to buy or sell units and an ongoing management fee.