Key Highlights

  • The fund is about $1.16 billion in size and holds 79 companies and issuers.
  • Australian issuers make up 79.05% of the portfolio, with Canada at 11.76% and supranational issuers at 5.82%.
  • The management fee is 0.22%, and the listed annual Yield is 4.41%.
  • The top ten holdings represent 39.00% of the fund, with Commonwealth bonds leading.

Betashares Australian Government Bond ETF (ASX:AGVT) tracks the Solactive Australian Government 7 to 12 Year Total Return Index, giving investors exposure to Government Bonds with medium-term maturities. The units were listed at $40.69, the fund is about $1.16 billion in size, and the management fee is 0.22%. Its focus on the 7 to 12 year segment sets it apart from funds that cover the full Maturity range.

Ticker

ASX:AGVT

Listed price

$40.69

Fund size

$1.16 billion

Management fee

0.22%

Listed annual yield

4.41%

Benchmark

Solactive Aus Gov 7-12 Yr TR AUD

Holdings

79 companies

Portfolio make-up

Bonds account for 100% of the fund, and the portfolio is 79.05% Australian. Canada makes up 11.76%, supranational issuers 5.82%, New Zealand 1.07% and the Netherlands 1.19%. The largest holdings include Australia 2.75% bonds at 4.49%, Commonwealth Loan securities at around 4.4%, and Australia 3% bonds at 4.28%.

The top ten holdings represent 39.00% of the fund, which is higher than in the broader composite funds, because the fund covers a narrower maturity band.

Income and costs

The listed annual yield is 4.41%, and the management fee is 0.22%. Turnover is reported at 18.62%, a moderate level. The yield is higher than the shorter-dated government funds, but the fund's price is more sensitive to rate moves because its holdings have longer maturities than cash-type products.

Risks to weigh

The main risk is Interest Rate sensitivity. Bonds in the 7 to 12 year range can lose more value than shorter-dated bonds when yields rise. The fund's Canadian and supranational holdings also expose it to currency and foreign issuer risk, although the currency exposure is limited relative to the portfolio. Investors should weigh the extra yield against that additional rate sensitivity.

Final Word

The Betashares Australian Government Bond ETF offers government bond exposure concentrated in the 7 to 12 year maturity range. Its yield is higher than shorter-dated government products, and its unit price will move more with interest rates as a result.