PowerShares Files To Offer Int’l Corporate Bond ETF

By Olivier Ludwig,

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PowerShares, the Wheaton, Ill.-based fund company best known for its Nasdaq ETF (NasdaqGM:QQQQ), filed to offer an international corporate bond ETF, joining a proposed fund from State Street Global Advisers that will also give investors exposure to corporate debt outside the U.S.

The International Corporate Bond Portfolio (NYSEArca:PICB) will have a 0.50 percent annual management fee. It will be based on the S&P International Corporate Bond Index.

The fixed-income portion of the ETF world has been growing recently, as investors seek securities with attractive yields, increasingly outside the U.S. In March, Boston-based SSgA filed to offer the SPDR Barclays Capital International Corporate Bond ETF (NYSEArca:IBND). Official U.S. interest rates are close to zero after the Federal Reserve cut rates to stimulate an economy in its worst crisis since the 1930s.

The new PowerShares ETF will invest investment-grade corporate bonds issued by non-U.S. issuers in the following currencies:euros; Australian, Canadian and New Zealand dollars; British pounds; Japanese yen; Swiss francs; Danish and Norwegian krone; and Swedish krona.

The fund will use a "sampling" methodology, meaning it won't own all the securities in the index to achieve its objective of tracking the index. The underlying index is generated and published under an agreement between Standard & Poor's and Credit Suisse, the filing said.

Don't forget to check IndexUniverse.com's ETF Data section.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing ETFs
Referenced Stocks: QQQ

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