Key Highlights

  • The fund is about $2.48 billion in size and holds 18 companies and issuers.
  • Australia accounts for 99.90% of the portfolio, and bonds make up 98.79%.
  • The management fee is 0.22%, and the listed annual Yield is 4.50%.
  • The top ten holdings make up 81.64% of the fund, mostly senior bonds from the major banks.

Betashares Australian Bank Senior Floating Rate Bond ETF (ASX:QPON) tracks the Solactive Australian Bank Senior Floating Rate Bond Index, providing exposure to senior floating rate notes issued by Australian banks. The units were listed at $26.21, the fund is about $2.48 billion in size, and the management fee is 0.22%. Floating rate notes pay coupons that reset with short-term interest rates, which shapes how the fund's income responds to rate changes.

Ticker

ASX:QPON

Listed price

$26.21

Fund size

$2.48 billion

Management fee

0.22%

Listed annual yield

4.50%

Benchmark

Solactive Aus Bank Sr Fltng Rt Bd TR AUD

Holdings

18 companies

Portfolio make-up

Bonds make up 98.79% of the fund, with cash at 1.21%. Almost all of the portfolio is Australian at 99.90%. The fund holds 18 issuers, and the top ten account for 81.64%, reflecting a heavy weighting to the big four banks.

The largest positions are National Australia Bank at 10.46%, Westpac at 10.00%, Commonwealth Bank at 9.58%, Westpac again at 9.54%, and Commonwealth Bank at 9.25%. Taken together, the largest bank issuers make up most of the fund.

Income and costs

The listed annual yield is 4.50%, and the management fee is 0.22%. Because the coupons reset with short-term rates, the yield tends to follow the cash rate rather than long-term bond yields. Turnover is reported at 44.32%.

Risks to weigh

Floating rate notes are less sensitive to Interest Rate changes than fixed-rate bonds, which reduces the price impact when rates move. The main risk is credit. Holdings are concentrated in a small group of banks, so an issuer-specific problem would affect a large share of the fund. Spreads on bank paper can also widen in stressed markets, lowering unit prices even when coupons remain steady.

Final Word

The Betashares Australian Bank Senior Floating Rate Bond ETF provides income linked to short-term rates from senior bank debt. Its concentration in a few large issuers is the main feature to weigh alongside its interest rate sensitivity.