Betashares has launched an ETF to invest fully in an ethically-screened portfolio of Australian bonds.
The Betashares Ethical Australian Composite Bond ETF (ASX: AEBD) offers investors exposure to a diversified portfolio of high-quality Australian corporate and government bonds that are screened to exclude issuers (other than sovereign bond issuers) with material exposure to fossil fuels or engaged in activities considered inconsistent with responsible investment considerations.
Betashares said, “AEBD represents a breakthrough in ethical Australian fixed income investing by aiming to track an index that combines robust environmental, social and governance (ESG) screens with an intelligent investment strategy that weights bonds on their risk-adjusted income potential, rather than adopting a debt-weighted indexing approach. This strategy seeks to provide higher returns compared to standard fixed income benchmarks, such as the AusBond Composite Index, appealing to both values-driven investors and those seeking strong financial performance.”
Also read: Strong Uplift In Yields
The company said in its statement: “Over the past two years, global interest rate hikes have placed fixed income in the spotlight, with Australian fixed income ETFs capturing over $10.3 billion in net inflows since October 2022. Betashares has received over 35% of these inflows as the largest provider of fixed income ETFs in Australia. As inflation continues to moderate and major central banks begin to cut interest rates, investor interest in fixed income is anticipated to strengthen, positioning AEBD as a timely solution for ethical Australian investors and advisers seeking exposure to core Australian fixed income options.”
AEBD will form part of Betashares’ range of ethical and responsible investment ETFs which now includes 9 funds and a total of $5.6 billion in funds under management as of end September 2024.
