New Listing

Eurizon launches active emerging market bond ETF

Launched on Connect ETFs ICAV, a new white label platform

Theo Andrew

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Eurizon SLJ Capital, the UK subsidiary of Eurizon Capital, has launched an active emerging market bond ETF as it marks its entry into the European ETF market.

The CO Eurizon SLJ EM Bond Strategic Income UCITS ETF is listed on the Euronext Dublin with a total expense ratio of 0.50%, and will list on the London Stock Exchange later this year.

The ETF invests in a broad array of bonds from across emerging markets “to provide income with an opportunity for capital growth”.

It will seek to provide emerging market income with developed market characteristics using a "quality-enhanced investment process".

It launched on the Connect ETFs ICAV, a new white-label ETF platform led by Market Access Asset Management and NTree International Limited.

Carne Global Fund Managers is the management company while Citi is the administrator and custodian.

The group earmarked its entry into the ETF market in April targeting UK-based investors.

The asset management arm of Intesa Sanpaolo Group houses roughly €392bn assets under management across several actively managed funds.

It comes as the active ETF market continues to grow in Europe, increasing five-fold since the start of 2015, from $6.1bn to $32.9bn by the end of 2023, according to data from ETFbook.

Emerging markets is one area where investors believe active management can add alpha to their portfolio, while fund selectors have also been calling out for more actively managed fixed income ETFs.

Demand is growing for “high conviction” active bond ETFs as they look to gain an edge by playing the idiosyncrasies of fixed income while addressing some of the challenges passive bond ETFs have in fully replicating indices.

Europe has seen a swathe of new active ETF entrants over the past 18 months from asset managers, including American Century Investments – which announced it would be entering European ETFs last month – AXA Investment Managers, Horizon Kinetics, abrdn and Investlinx.

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