In times of market uncertainty, investors turn to less risky investment opportunities that on the one hand do not face the burden of volatile markets and, on the other hand, serve as an alternative to holding cash. After the successful release of its Amundi Prime US Treasury Bond 0-1 Y UCITS ETF, Europe’s largest asset manager once again chose Solactive as its index provider of choice in the extension of their fixed income offering of their established Prime ETF range. Amundi’s new Prime Euro Gov Bonds 0-1 Y UCITS ETF tracks the Solactive Eurozone Government Bond 0-1 Year Index and, therefore, represents a European pendant of the previously issued US Treasury Bond 0-1 Y ETF.
The Amundi Prime Euro Gov Bonds 0-1 Y UCITS ETF includes euro-denominated government bonds and bills issued by central governments within the Eurozone with a maturity between one month and one year. As the bonds’ liquidity features denominate a critical factor for government bonds investors, all fixed income instruments included in the index must have a minimum amount outstanding of at least 1.5 billion Euros, to guarantee liquidity standards.
The index only includes fixed coupon and zero-coupon instruments, and floating-rate notes or inflation-linked bonds are not eligible for inclusion. The index calculation is set up specifically as Total Return. Thus, all cash flows from coupon payments, corporate actions, or redemptions will be reinvested in the index. As of the 21st of October, the Amundi Prime Euro Gov Bonds 0-1 Y UCITS ETF contains 109 Eurozone government bonds, which are considered widely as being the most secure and liquid securities in the world. The ETF’s low-risk profile and an intra-day invest and devest possibilities attribute the fund cash-like characteristics.
“Amundi’s new Prime Euro Gov Bonds 0-1 Y UCITS ETF gives investors an additional opportunity to effectively park short-term liquidity, and, therefore, to switch between risk-scenarios straightforwardly,” comments Timo Pfeiffer, Chief Markets Officer at Solactive. “Solactive and Amundi both share an uncompromising client-centric approach, resulting in an ETF that enables investors to engage with European Government Bonds at a fairly low expense ratio. We are looking forward to closer collaborations with Amundi going forward.”
Matthieu Guignard, Global Head of Product Development and Capital Markets – Amundi ETF, Indexing & Smart Beta, said: “The Amundi Prime range of ETFs using Solactive’s high quality yet cost-effective indices has already received over €2bn[1] in investment following the launch last year. This latest addition to the product range provides investors with an important core exposure with industry-leading fees.”
The Amundi Prime Euro Gov Bonds 0-1 Y UCITS ETF started trading on the 21st of October on Deutsche Börse Xetra.
