Amundi has launched a new ETF based on the EuroMTS Highest Rated Government 1-3 Index, an index which provides exposure to only the highest-rated eurozone sovereign bonds.
Amundi lists strictly “AAA rated” eurozone bond ETF, providing exposure to the eurozone’s core.
Reviewed on a monthly basis, the EuroMTS Highest Rated Government 1-3 Index is composed of government bonds with a maturity of 1-3 years issued by eurozone member states with at least two equivalent ratings of “AAA” from either S&P, Moody’s or Fitch.
The constituents of the index must have a minimum outstanding amount of €2 billion, be straight fixed coupon bullet-maturity bonds and be denominated in euros.
The index also has a minimum of five issuers; currently, these are Austria, France, Finland, Germany and the Netherlands.
The Amundi ETF Govt Bond Highest Rated EuroMTS Investment Grade 1-3 (AA13) is the first ETF in Europe to enable investors to take positions on the short fixed income maturity segment in eurozone countries with the top investment rating.
The Amundi ETF fixed income range also includes a fund which tracks the equivalent “all maturities” index, the Amundi ETF Govt Bond Highest Rated EuroMTS Investment Grade (AM3A), as well as an ETF which offers an alternative solution for those who, by contrast, wish to be exposed to countries with lower ratings within the investment-grade universe, the Amundi ETF Govt Bond Lowest Rated EuroMTS Investment Grade (X1G).
This latest ETF will likely be popular with European investors seeking exposure to only the highest quality euro-denominated debt, but who require more diversification that simply holding, say, German bunds. The short duration of the fund also helps limit investors exposure to interest rate volatility.
Valérie Baudson, Managing Director of Amundi ETF comments: “This launch is perfectly in line with our wish to offer investors a complete range of solutions to manage their asset allocation according to their market anticipations.”
The fund is listed on NYSE Euronext in Paris and comes with a TER of 0.14%.
Amundi ETF is Europe’s third-largest ETF provider with over 100 funds and assets of over €6.5 billion. Its parent company, Amundi, ranks second in the European asset management industry and ninth worldwide with almost €680 billion under management.