State Street Global Advisors, the Boston investment management arm of State Street Corp., has started offering a bond exchange-traded fund that tracks Deutsche Bank AG's DB global government ex-U.S. inflation-linked bond capped index.
The SPDR DB International Government Inflation-Protected Bond ETF began trading Wednesday on the American Stock Exchange.
The index it tracks includes 120 inflation-indexed bonds from 18 developed and emerging countries outside the United States.
To be included in the index, bonds must be capital-indexed and linked to an eligible inflation index; have at least one year remaining to maturity; have a fixed, step-up, or zero notional coupon; and settle on or before the index rebalancing date.
The fund's expense ratio is 0.5%.
James Ross, a senior managing director at State Street, said in a press release that demand for international inflation-linked bond exposure has "increased significantly in recent years as investors look to improve the risk-return profile of their portfolios by hedging against inflation and U.S. dollar exposure while improving diversification."
State Street managed more than $141 billion of exchange-traded fund assets as of Feb. 29.
Its investment management arm managed $2 trillion as of Dec. 31.
