BlackRock expands iShares’ fixed income ETF suite

BlackRock Australia has announced it will bring a new fixed income exchange traded fund (ETF) to market next month under its iShares brand, designed as a diversified “building block” for investors and financial advisers.

The iShares Core Global Aggregate Bond (AUD Hedged) ETF (AGGG) will track the Bloomberg Global Aggregate Bond Index (AUD Hedged) benchmark while seeking to deliver access to a diversified range of government, securitised and investment grade corporate bonds spread across multiple regions.

With over 19,000 securities at its disposal, the ETF is designed for investors and advisers to balance their fixed income exposure across regions and sectors while leveraging the benefits of currency hedging to capitalise on untapped opportunities.

“Fixed income ETFs continue to play an important role in portfolio construction, particularly in an environment where investors are seeking global diversification and income,” Steve Ead, Head of Global Product Solutions for Australasia BlackRock, said.

“AGGG offers a simple, cost-effective way to access global investment grade bonds, complementing our existing suite of iShares fixed income ETFs in Australia and serves as a tool for advisers and asset allocators to help build diversified multi-asset portfolios.”

The launch of AGGG, with a management fee of 0.18 per cent, comes as iShares ETF marks AUD$50 billion in Australian assets under management as of 3 September.

“The launch of AGGG expands BlackRock’s Australian iShares fixed income lineup, delivering a core building block for Australian advisers and investors seeking global investment-grade bond exposure hedged to AUD.,” Katherine Palmer, Head of Fixed Income and Credit Product Strategy for Australia, BlackRock, said.

“The proportion of fixed income assets yielding over four per cent have increased markedly since 2021, with investors now able to access a more interesting array of yields across different fixed income sub-categories – including the investment grade space.”