Timmo Pfeiffer, Solactive

Solactive increases APAC exposure


Solactive has released the Solactive Australian Government 7-12 Year AUD TR Index, serving as the underlying index of the BetaShares Australian Government Bond ETF (AGVT). 

Another BetaShares ETF, the BetaShares Australia 200 ETF (ASX: A200), which uses an underlying Solactive Index, recently became Australia’s fastest ETF to exceed AUD500 million in FUM. 

BetaShares’ Australian Government Bond ETF is tailored for investors who, in times of global uncertainty, lower interest rates and high durations, want to gain exposure to the performance of the Australian sovereign and quasi-sovereign market with 7-12-year time to maturity. 

The underlying index, the Solactive Australian Government 7-12 Year AUD TR Index, is a rules-based, market value weighted index engineered to mirror the performance of AUD-denominated bonds. Federal and state government bonds make up 75 per cent of the index, while the remaining 25 per cent is dedicated to supranational organisations, sovereign agencies, and provinces. 

Timo Pfeiffer (pictured), Head of Research at Solactive, says: “Our new Solactive Australian Government 7-12 Year AUD TR Index is a fitting index for investors who want to access income while keeping a bond-like risk profile. Low interest rates force investors to look out for lucrative investment opportunities. With AUD-denominated bonds, they can participate in the performance of a small but growing market that is expected to continue its impressive development. BetaShares is a leading ETF issuer in the fast-growing Australian ETF market, with whom we have worked numerous times. We are looking forward to strengthening our relationship with them further.” 

Alex Vynokur, Chief Executive at BetaShares, says: “We’re happy to be furthering our relationship with Solactive as we create more intelligent building blocks for the Australian marketplace. Since their launch, we’ve seen substantial uptake in our existing suite of bond ETFs, which now amounts to over A$1B in assets. The launch of AGVT provides investors with another innovative tool to add to their portfolios and access the income and low-risk characteristics of the Australian government bond market.”

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