Betashares has launched an exchange-traded fund (ETF) on the Australian Securities Exchange (ASX) that comprises Australian government and corporate bonds from entities engaged in positive environmental, social and governance practices.
Specifically, the Betashares Ethical Australian Composite Bond ETF (ASX code: AEBD) aims to exclude entities with ties to fossil fuels, gambling, tobacco, alcohol, militarism and other activities deemed inconsistent with responsible investment practices.
The offering tracks the Bloomberg Australian Enhanced Yield Ethically Screened Composite Bond Index and has a management fee of 34 basis points.
Rather than a traditional debt-weighted approach, the index AEBD follows applies a risk-adjusted income-based weighting, aiming to outperform typical Australian fixed income benchmarks.
According to Betashares, the ETF is the first on the Australian market to offer a fully ethically screened portfolio of Australian bonds.
“AEBD represents a core portfolio building block for ethically minded Australian investors and their advisers seeking an intelligent fixed income allocation that reflects responsible investment principles,” Betashares chief executive Alex Vynokur said.
“We’re proud to leverage our market leadership in both ethical and fixed income ETFs to offer a unique portfolio solution that meets the evolving preferences of advisers and investors alike.”
The investment manager suggested the ETF can be used as a stable, long-term holding option that complements equity or diversified portfolios with its focus on Australian bonds.
With monthly distributions and a portfolio carefully screened for quality and responsible practices, AEBD is designed for investors seeking both steady income and a positive environmental and social impact.
AEBD adds to Betashares’ line-up of offerings in the space, now comprising almost 100 funds listed on the ASX, following last month’s launch of a Nasdaq 100 geared ETF and a global defence investment vehicle.
