ETF spotlight on WisdomTree Asia Local Debt Fund (NYSEArca: ALD), part of an ongoing series.
Assets: $492.8 million.
Objective: The ETF invests in bonds denominated in currencies of Asia countries, not including Japan. The countries include Australia, China, Hong Kong, India, Indonesia, Malaysia, New Zealand, Philippines, Singapore, South Korea, Taiwan and Thailand.
What You Should Know:
- ALD has an expense ratio of 0.55%.
- Country allocations include: Australia 11.18%, Singapore 11.14%, South Korea 11.14%, Thailand 11.12%, Indonesia 11.01%, Malaysia 11.01%, Hong Kong 5.64%, Philippines 5.64%, New Zealand 5.62%, India 5.58%, China 5.58%, Taiwan 5.34%.
- The fund holds local-currency government sovereign debt and agency bonds.
- Similar ETFs in the firm’s lineup include the WisdomTree Emerging Markets Local Debt (NYSEArca: ELD) and WisdomTree Dreyfus Emerging Currency (NYSEArca: CEW).
- The relatively new ETF, which was introduced in March, is among the top new ETF launches of the year, with $471 million in net flows as of June 30, reports Jessica Toonkel for InvestmentNews. The popularity of ALD seems to indicate that investors are more willing to go outside of the U.S. for yield and investment diversification.
- ALD has a SEC 30-day yield of 2.67%, according to WisdomTree’s website.
The Latest News:
- As debt problems hover over the U.S. and Europe, the robust returns and high yields of emerging market sovereign debt have been attracting bond investors, according to Reuters.
- Emerging market bond funds saw $53 billion in inflows last year, according to EPFR. Investors have funneled $15 billion more into these funds so far this year.
- Over the past year, emerging market bond funds have garnered returns of 12.4% on average, compared with the 6.1% gain on taxable U.S. intermediate-term bonds, according to S&P.
- Traders who are seeking to capitalize on the weakening U.S. dollar have also been looking into bonds denominated in emerging market currencies.
- WisdomTree says it will list its stock on the Nasdaq later this month. [WisdomTree to Move from the Pink Sheets]
For past stories in this series, visit our ETF Spotlight category.
WisdomTree Asia Local Debt Fund
Max Chen contributed to this article.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.