A version of the PIMCO EM Advantage Local Bond Index Source ETF distributing dividends monthly is now available in USD on the London Stock Exchange under the ticker EMLI LN.
The ETF currently has assets of USD213m.
The PIMCO EM Advantage Local Bond Index Source ETF offers exposure to local emerging market sovereign debt via the PIMCO EM Advantage Local Currency Bond Index, a GDP-weighted index offering exposure to 15 emerging market countries.
The ETF provides exposure to key emerging market countries absent from traditional indices (e.g. China and India). As of end of December 2013, the effective yield of the index was 7.4 per cent with a duration of three years.
“Due to its exposure to a broader set of systemically important emerging market countries via various local currency fixed instruments, the EM Advantage ETF offers investors a lower duration and lower volatility alternative to traditional EM local debt exposure,” says Fabrizio Palmucci, director at Source.
In 2013, EM Advantage Index outperformed the JP Morgan GBI-EM Global Diversified Index by 3.1 per cent.
“We are seeing significant investor interest in this product,” says Source CEO Ted Hood. “We are pleased to be able to launch a dividend distributing share class in response to strong client demand. EM local debt offers interesting yield opportunities which a number of clients have expressed the desire to receive as monthly distributions.”
The PIMCO EM Advantage Local Bond Index Source ETF is traded on the London Stock Exchange and has an annual management fee of 0.60 per cent.
