Key Highlights

  • The fund is about $1.88 billion in size and holds 67 companies and issuers.
  • Bonds make up 99.49% of the portfolio, with Australian issuers at 65.14%.
  • The management fee is 0.25%, and the listed annual Yield is 5.59%.
  • The top ten holdings represent 21.38% of the fund, with no single issuer above 2.7%.

Betashares Australian Investment Grade Corporate Bond ETF (ASX:CRED) tracks the Solactive Australian Investment Grade Corporate Bond Select Index, giving investors exposure to investment grade corporate debt. The units were listed at $22.51, the fund is about $1.88 billion in size, and the management fee is 0.25%. The fund invests passively, and its corporate focus offers a higher yield than government-only bond products.

Ticker

ASX:CRED

Listed price

$22.51

Fund size

$1.88 billion

Management fee

0.25%

Listed annual yield

5.59%

Benchmark

Solactive Aus IG Corp Bond Slct TR AUD

Holdings

67 companies

Portfolio make-up

Bonds account for 99.49% of the fund, with cash at 0.52%. Australian issuers make up 65.14%, followed by Germany at 12.70%, New Zealand at 5.73%, the United Arab Emirates at 3.77%, France at 3.84% and Spain at 3.66%. The largest holding is Emirates NBD at 2.68%, followed by Stockland, E.ON, Aroundtown and Scentre Group, each between 2% and 2.2%.

The top ten holdings make up 21.38% of the fund, so the spread across issuers is relatively even.

Income and costs

The listed annual yield is 5.59%, and the management fee is 0.25%. The yield reflects the Credit spread paid on corporate bonds above government rates. Turnover is reported at 43.22%, which suggests the portfolio is adjusted regularly as bonds mature or are reweighted.

Risks to weigh

Investment grade bonds carry less Default Risk than high-yield debt, but they are not risk-free. Their prices fall when interest rates rise, and they can lose value when credit spreads widen, even if issuers remain sound. The fund's international mix adds exposure to foreign issuers and currency-hedging arrangements, which investors should understand before investing.

Final Word

The Betashares Australian Investment Grade Corporate Bond ETF offers a diversified route into corporate credit at an investment grade standard. Its yield is higher than government bond funds, and its unit price will respond to both interest rates and changes in credit spreads.