State Street Global Advisors (SSgA), the asset management business of State Street Corporation, has listed the SPDR Barclays Capital Short Term High Yield Bond ETF (SJNK) on the NYSE Arca.
The new SPDR ETF offers investors access to high yield corporate bonds with short durations, which tend to be less volatile and sensitive to changes in interest rates than debt securities with longer durations. The fund’s annual expense ratio is 0.40 per cent.
The SPDR Barclays Capital Short Term High Yield Bond ETF seeks to track the performance of the Barclays Capital 0-5 Cash Pay Constrained High Yield Index. The Index includes publicly issued US dollar denominated, non-investment-grade, fixed rate, taxable corporate bonds that have a remaining maturity of less than 5 years, are rated high-yield (Ba1/BB+/BB+ or below) using the middle rating of Moody’s Investors Service Inc., Fitch, Inc., or Standard & Poor’s Inc., and have USD350 million or more of issuance. As of March 5, 2012 there were approximately 351 securities in the Index with an average modified adjusted duration of approximately 2.06 years.
"Offering equity-like returns with less volatility, demand for high yield bond exposure is on the rise," says James Ross (pictured), senior managing director and global head of SPDR Exchange Traded Funds at State Street Global Advisors. "The launch of the SPDR Barclays Capital Short Term High Yield Bond ETF provides investors and advisors with an opportunity to gain cost efficient access to short term high yield bonds, a segment of the high yield market that can help to protect against an inevitable rise in interest rates."
