VanEck launches US Treasury Bonds ETF

Oksana Patron

16 May 2023

VanEck has announced the launch of its new Short-term US Treasury Bonds (TBIL) ETF which will list on the Australian Securities Exchange (ASX) on Thursday.

The fund, which will be VanEck’s 33^rd exchange trade fund (ETF), has been designed to target Australian investors and provide them with an exposure to liquid US Treasury Securities offering investors a potential hedge against systemic or market episodes.

VanEck said that the fund was launching at an opportune moment for investors as over the past 12 months short-term treasury bond yields jumped following a series of interest rate hikes and they should continue to rise while inflation persists.

“As TBIL comes to market short-term US treasury yields have surged to highs not seen for over a decade as the Fed has continued its unrelenting fight against inflation,” Arian Neiron, chief executive and managing director VanEck, Asia Pacific, said.

“That presents an attractive opportunity for Australian investors to target the high yields of short dated US treasury securities given the RBA cash rate is lower.

“Investors are increasingly looking for portfolio defence as inflation remains high and markets are volatile. Improving the credit quality of investors’ fixed income sleeve can help build portfolio defence given US Treasury Securities are the ‘go-to’ asset for risk management,” he added.