Lyxor has made a significant addition to its range of Core, low-cost ETF building blocks with the launch of a new fixed income ETF tracking a diversified portfolio of government bonds from around the world.
Listed on the London Stock Exchange and Borsa Italiana, the Lyxor Core Global Government Bond (DR) UCITS ETF tracks the FTSE G7 and EMU Government Bond Index (Developed Markets). It invests in investment-grade government bonds issued by G7 or eurozone countries and is diversified across all the major markets, including Japan, the United Kingdom, Germany, Italy, France, the USA and Canada. Maximising diversification across markets and issuers may improve the risk profile, as well as limit the concentration risk of investing in a single local market.
As it is part of Lyxor’s low-cost Core range, the Lyxor Core Global Government Bond (DR) UCITS ETF tracks a high quality index (which is part of the established FTSE WGBI family), is physically replicated and comes with a Total Expense Ratio (TER) of just 0.09% - lower than any fund with significant assets in this market1. Investors looking to reduce volatility and mitigate the impact of currency moves on the fund’s total return could invest in the euro-hedged share class with a TER of 0.15%.
The ETF is domiciled in Luxembourg and does not use securities lending, in line with the Lyxor Core principles of simplicity, security and familiarity.
“This could be an efficient way to own a diversified government bond portfolio in one low-cost ETF,” says Philippe Baché, Head of Fixed Income at Lyxor ETF. “FTSE Russell is well known for its quality government bond indices. We have included a FX hedging mechanism as it can reduce volatility and tends to improve the risk profile over the long term.”
Find out more about the Lyxor Global Government Bonds (DR) UCITS ETF
