ETF Spotlight on the PIMCO Australia Bond Index ETF (NYSEArca: AUD), part of an ongoing series.
Assets: $25.9 million
Objective: The PIMCO Australia Bond Index ETF tries to reflect the performance of the BofA Merrill Lynch Diversified Australia Bond Index, which provides exposure to Australian dollar-denominated, investment-grade bonds.
Holdings: Top holdings include New S. Wales Treasury Corp 9.5% 2/1/2018, Treasury Corp Victoria Gov 5.3% 11/15/2018, Australian Government 4.1% 4/21/2023, National Australia Bank SR Unsec 3.9% 3/7/2018 and South Aust Govt Fin Auth Loc Gov 3.8% 9/20/2017.
What You Should Know:
- Pacific Investment Management Company sponsors the ETF.
- AUD has a 0.45% expense ratio.
- The ETF has 43 components and the top ten make up 43.4% of the overall portfolio.
- Sector allocations include government-related 63%, investment-grade credit 28% and net cash equivalents 9%.
- Country allocations include Australia 71.4%, Supranational 9.4%, Germany 3.8%, Norway 3.1%, U.K. 2.5%, Canada 1.9%, Netherlands 1.8% and Sweden 1.8%.
- Credit quality breakdown include government 26.1%, AAA 26.5%, AA 30.5%, A 7.2% and not rated 5.3%.
- The fund has an effective duration of 3.99 years.
- The ETF offers a 3.26% 30-day SEC yield.
- AUD is up 2.3% over the past month, up 4.7% over the last three months and up 3.7% year-to-date.
- The fund shows an average daily volume of 2,931 shares, so investors should use limit orders to take better control of trades.
- The ETF is also trading at a -0.95% discount to its net asset value, which means that AUD’s trading price is below the value of its combined underlying securities.
- The WisdomTree Australia & New Zealand Debt Fund (NYSEArca: AUNZ) is the only other ETF to provide significant exposure to Australian debt.
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