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State Street Rolls Out Fixed Income ETFs

By Jay Polansky editors@plansponsor.com | June 19, 2012
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June 19, 2012 (PLANSPONSOR.com) -Two State Street Global Advisors Fixed Income SPDR Exchange-Traded Funds (ETFs) began trading on the NYSE Arca.

They are the SPDR BofA Merrill Lynch Crossover Corporate Bond ETF and the SPDR BofA Merrill Lynch Emerging Markets Corporate Bond ETF.

The SPDR BofA Merrill Lynch Crossover Corporate Bond ETF tracks the performance of the BofA Merrill Lynch US Diversified Crossover Corporate Index, which includes 3,029 securities. Each security included in the index has a BBB1 through BB3 inclusive rating, a fixed income coupon schedule, at least one year remaining to final maturity and a minimum amount of outstanding of $250 million or more of issuance. The fund’s expense ratio is 0.30%.

The SPDR BofA Merrill Lynch Emerging Markets Corporate Bond ETF seeks to track the performance of the BofA Merrill Lynch Emerging Markets Large Cap Senior Corporate Index, which includes 454 securities.

“Featuring potentially higher yields than most investment grade bonds and potentially less credit risk than most high yield issues, demand for crossover bonds is growing among financial advisers and investors during this extended low-yield environment,” said James Ross, senior managing director and global head of SPDR Exchange-Traded Funds at State Street Global Advisors. “With the launch of the SPDR BofA Merrill Lynch Crossover Corporate Bond ETF, precise, cost-efficient access to this asset class is within reach for investors seeking exposure that spans both investment grade and high-yield bonds.”