PIMCO launches Australia Bond Index ETF; Canada and Germany to follow

Nov 2nd, 2011 | By | Category: Fixed Income

California-based fixed income giant PIMCO has launched the first of three new country index ETFs: the PIMCO Australia Bond Index Fund. This will soon be followed by the PIMCO Canada Bond Index Fund and the PIMCO Germany Bond Index Fund.

PIMCO launches Australia Bond Index ETF

PIMCO launches Australia Bond Index ETF; Canada and Germany to follow.

According to PIMCO, these ETFs are designed to enable investors to capitalise on opportunities within three countries whose balance sheets and debt dynamics are currently well positioned to navigate the downside effects of slower global growth and ongoing national and personal deleveraging.

Australia, Canada and Germany currently have some of the strongest balance sheets among developed nations thanks to both internal and external factors.

Australia has been and remains one of the largest exporters of commodities and serves as an important trading partner with emerging markets in Asia. It’s also currently one of the higher-yielding currencies in both the developed and developing world.

Meanwhile, Canada is one of the largest exporters of agricultural products, raw materials and oil and has historically had a low debt burden, a growing economy and prudent fiscal management. And Germany appears to have deftly navigated the financial crisis and is the world’s second largest exporter as well as the largest economy in Europe.

“These new index ETFs are designed to help investors access select countries that may offer better risk-adjusted returns in this ‘New Normal’ environment, and benefit from PIMCO’s trading and investment expertise in local markets,” said Tammie Arnold, managing director and global head of the firm’s ETF business.

“With ETFs, investors may benefit from convenient access to PIMCO’s capabilities as well as the portfolio transparency and intra-day pricing attributes of the ETF vehicle.”

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