11 Apr – 15 Apr 2016

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The latest data on ETF fund flows shows an interesting result. All bond ETFs experienced outflows except one and that was the BetaShares Australian High Interest Cash ETF. Bond ETFs are a very useful way for investors to shift asset allocation depending on investors’ views of the current risk environment. Investors may shift funds from an ETFs holding government bonds to an ETF holding corporate debt or other credit instruments, or vice versa. Occasionally they move out of bond ETFs into a cash ETF. This is what investors did this week. It may be viewed as either a harbinger of impending doom in bond and credit markets (rates rising and/or spreads widening) or just a prudent reaction to low yields or increasing volatility. In any event it shows how flexible an ETF can be when changing asset exposures.

etfs-15apr-yieldreport
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ASX CASH & BOND ETFS*

NAMESYMBOLCLOSE
PRICE
1m (%)1y (%)MER (%)FUND
SIZE ($m)
BetaShares Aust High Int CashAAA50.130.212.570.18952.46
SPDR S&P/ASX Aust BondBOND26.05-0.261.830.2423.66
SPDR S&P/ASX Aust Govt BondGOVT25.83-0.341.800.227.81
iShares Composite Bond ETFIAF106.20-0.231.820.24320.62
iShares Treasury ETFIGB104.08-0.391.320.2622.62
iShares Govt Inflation ETFILB114.320.41-1.380.2657.62
Russell Aust Select Corp Bond ETFRCB20.16-1.810.2878.87
Russell Aust Govt Bond ETFRGB21.38-1.660.24136.99
Russell Aust Semi-Govt Bond ETFRSM20.42-1.970.26122.23
Vanguard® Aust Fxd Int Index ETFVAF49.56-0.221.820.20356.65
Vanguard® Aust Govt Bond Index ETFVGB49.30-0.271.800.2078.61
Vanguard® International Crdt Securities Ind(Hedged) ETFVCF52.091.72-0.303.65
Vanguard® International Fix Int Ind(Hedged) ETFVIF52.760.64-0.2012.13

*1 month/1 year performance as at end of March 2016. Closing price as at week end. Return in AUD before fees

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