VanEck has announced a new ETF which will list on the Australian Securities Exchange (ASX:TBIL) and will allow Australian investors to access short-term US Treasury bonds.
The VanEck 1-3 Month US Treasury Bond ETF (TBIL) invests in a portfolio of US dollar denominated Treasury Bills issued by the US Government with a maturity ranging from 1-3 months with the aim of providing investment returns (before fees and costs) that closely track the returns of the Index.
VanEck said: “Short-term US treasury bonds are high-quality, AAA-rated securities that can diversify your investment portfolio.
“Over the past 12 months short-term treasury bond yields have jumped following a series of interest rate hikes from the Federal Reserve, and many investors think these will continue while inflation persists.
“To help investors access this opportunity, we’re launching the VanEck 1-3 Month US Treasury Bond ETF (ASX: TBIL). TBIL’s focus on short-dated maturity US Treasury bonds offers the potential for attractive income, paid monthly.”
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Arian Neiron, chief executive officer and managing director, VanEck, Asia-Pacific, said “TBIL will be the first short-term US Treasury bond ETF of its kind listed on the ASX.
“The fund is launching at an opportune moment for investors as over the past 12 months, short-term treasury bond yields have jumped following a series of interest rate hikes from the Federal Reserve. Short-term treasury bond yields should continue to rise while inflation persists.”
Switzer Higher Yield Fund
Meanwhile, AGP Investment Management as Responsible Entity for the Coolabah-managed Switzer Higher Yield Fund (Cboe SHYF) has announced its intention to terminate the fund.
It said in its market announcement: “The Fund was developed with the objective of achieving an attractive cash yield with low capital volatility by investing in a portfolio of high quality and liquid fixed income securities. However, given the current size and demand for the Fund, the RE considers it highly unlikely that the Fund will be able to reach sufficient scale to invest in accordance with the investment strategy designed to achieve this objective and to be economically viable for investors.
“Accordingly, the RE has formed the view that it is in investors’ best interests to return their capital and terminate the Fund.” The termination is expected to take effect around June 8.
Despite efforts to make the fund more attractive and accessible to retail investors including an investment management change and listing, the fund has reduced due to outflows to $12 million. The fund size at one stage was over $37 million.
