New Products
New London-Listed ETF Aims To Capture Corporate Bond Returns From Russia
FinEx ETF, which is part of FinEx Group, the international investment house, has launched a Russian corporate bond exchange-traded fund on the London Stock Exchange, saying it is giving clients access to a sometimes hard-to-access market.
The firm said that after the listing of the FinEx Tradable Russian Corporate Bonds UCITS ETF, it aims to cross-list this product as soon as possible on other major stock exchanges in Europe.
The fund tracks the Barclays EM Tradable Russian Corporate Bond Index, which focuses on shorter maturity liquid eurobonds issued by Russian non-sovereign issuers, a statement from the firm said. FinEx said it plans to launch the ETF on the Moscow Exchange MICEX-RTS shortly, which it expects to be the first such fund to list in Russia.
The firm, explaining its confidence in the launch, cited its own research showing that 44 per cent of European institutional investors expect to increase their investment in ETFs over the next 12 months. The corresponding figure for three years is 46 per cent, it said.
Deborah Fuhr, partner at independent research and consultancy firm ETFGI, and a well-known commentator on the ETF sector, was positive about the launch.
“This is far from another ‘me too’ entry into what some commentators might say is a highly-competitive ETF market. FinEx has a fresh take on the ETF market with its strategy to act as a bridge, bringing Western style products to emerging markets while offering Western investors access to emerging economies. It is an area of the market that offers great potential,” she said.
Among other findings from its research, FinEx said that 65 per cent of those interviewed invest in high yield debt, with 54 per cent invested in emerging market high yield debt. Some 72 per cent believe that institutional investors will increase their exposure to emerging market corporate debt over the next 12 months because it looks increasingly attractive as a result of continued economic growth and financial reforms.
When looking at the next five years, 35 per cent of those interviewed expect institutional investors to increase their exposure to Russian corporate debt, with 5 per cent expecting a "significant increase" and 30 per cent a "slight increase", it added.
Assets invested in ETFs and exchange-traded products in Europe reached a new all-time high of $389 billion at the end of January.
