Key Highlights

  • BNDS is actively managed by Western Asset, drawing on Interest Rate positioning, sector allocation and security selection rather than passive index replication.
  • The fund's holdings span 519 companies, with the top 10 representing just 14.74% of total assets.
  • BNDS reported an annual Yield of 4.43%, with September distributions at $0.099, up from $0.085 in June.
  • The Turnover ratio was reported at 21.70%, and the fund carries a management fee of 0.42% per annum.

Fund Overview and Objective

BNDS, admitted to the ASX on 16 November 2018, sits within the Bonds - Australia category and is benchmarked against the Bloomberg AusBond Composite 0+Y TR AUD Index. Unlike passively managed peers, BNDS follows an active Investment approach that draws on duration and Yield Curve positioning, alongside sector and security selection, with risk management supported by Credit research and Diversification guidelines.

The management fee was reported at 0.42% per annum, reflecting the additional cost typically associated with active strategies.

Portfolio Composition

The fund's asset allocation was reported at 98.22% in bonds and 1.79% in cash. BNDS held a wide base of 519 companies, with the top 10 holdings collectively representing 14.74% of the portfolio and a turnover ratio of 21.70%, indicating regular repositioning activity consistent with an active mandate.

Leading holdings included Australian Commonwealth Government Loans (2.12%) and a series of state treasury corporation bonds from New South Wales and Victoria.

Geographic Exposure

Australia accounted for 77.36% of the portfolio, with Canada at 3.53%, New Zealand at 3.83%, and smaller exposures to the United Kingdom (2.12%), the United States (2.46%), Germany (2.16%) and supranational issuers (2.10%).

Distribution and Yield Profile

BNDS reported an annual yield of 4.43%. Distribution amounts rose from $0.085 in June to $0.087 in July, $0.097 in August and $0.099 in September, following a low base of $0.020 in May, marking a notable increase across the period reviewed.

Conclusion

BNDS distinguishes itself among the funds reviewed through its active management structure, with a broad base of 519 holdings and a turnover ratio reflecting ongoing portfolio adjustments by its manager. Its distribution figures rose steadily across the months examined, and its geographic exposure remains heavily weighted to Australia while retaining modest diversification across several other developed markets.