Goldman Sachs Asset Management (GSAM) has launched the Goldman Sachs Treasury Access 0-1 Year ETF (GBIL), the first exchange-traded fund (ETF) to offer same-day settlement of creations and redemptions in the short-term US Treasury market.
The fund began trading on the NYSE Arca on 8 September with USD20 million in assets.
The cost to investors is 14 basis points (bps), placing it among the most competitively priced ultrashort duration ETFs on the market.
"The bond trading environment has become more complicated. We wanted our first fixed-income ETF to provide investors a low cost way to obtain the credit quality and income they look for in the Treasury markets, but with greater transparency and ease of use,” says Michael Crinieri, GSAM's global head of ETF strategies.
GBIL will be jointly managed by GSAM’s Liquidity solutions team and its quantitative investment strategies team. The liquidity solutions team has managed money market and short-duration strategies since 1988 and has over USD350 billion under management globally. The quantitative investment strategies team was founded in 1989 and manages over USD83 billion globally.
“We believe ETFs will continue to become a preferred vehicle for Treasury investing given the unprecedented level of demand for Treasuries as a result of recent regulation,” says Christina Kopec, head of product strategy for global fixed income.
GBIL seeks to track the Citi US Treasury 0-1 Year Composite Select Index, which is designed to measure the performance of US Treasury Obligations with a maximum remaining maturity of one year.
“Investors continue to seek opportunities to capture specific sectors in their portfolios in the most effective way,” says Arom Pathammavong, global head of Citi fixed income indices. “We are pleased to have worked with GSAM to develop a short-term Treasury index that has been used to bring this innovative ETF to market.”