State Street Global Advisors (SSGA) has cross-listed the SPDR Barclays Global Aggregate Bond UCITS ETF on SIX Swiss Exchange. The ETF provides investors with low cost, globally diversified fixed income exposure, and has been listed with several currency-hedged share classes.
The SPDR Global Aggregate Bond ETF tracks the Bloomberg Barclays Global Aggregate Index.
The primary share class of the fund is unhedged and trades in USD, but there are also USD, EUR, CHF and GBP currency-hedged share classes available.
The ETF was first launched on Xetra in January this year and is also available on the London Stock Exchange and Borsa Italiana.
The ETF tracks the Bloomberg Barclays Global Aggregate Index, one of the world’s largest and most liquid fixed income indices.
The index consists of approximately 20,000 securities across 2,400 issuers, 24 currencies and 70 countries. The underlying constituents cover 94% of the global fixed income market and include treasury/government, government-related, corporate and securitized fixed-rate bonds from developed and emerging markets.
The index currently yields 2.51% with an effective duration of 7.0 years. The US has the top country weight with 37.4%, followed by Japan (17.6%), France (6.1%) and the UK (5.6%). More than half the index is allocated to treasuries (54.3%), with mortgage-backed securities (13.6%), industrial corporates (10.4%) and financial corporates (7.0%) also having significant sector weights.
Over one-third of the index’s exposure is drawn from the highest credit quality rated Aaa securities (38.8%), followed by Aa (16.3%), A (27.6%) and Baa (17.7%).
The ETF is physically replicated, using a sample-based approach. Given the vast number of securities in the index, it is impractical and inefficient for the fund to hold all the index constituents.
The ETF has a total expense ratio (TER) of 0.10%, which applies to both unhedged and currency-hedged share classes. This fee mirrors that of its rival, the iShares Global Aggregate UCITS ETF (AGGG LN), which tracks the same index.
The iShares fund, which listed on the LSE in November 2017, now tops almost $1 billion in assets under management.
The SPDR ETF is off to a decent start too, having grown its AUM to over $220 million since its January debut.