Goldman Sachs Asset Management Launches New Smart Beta Bond ETF

Jun 8 2017 | 10:25pm ET

Goldman Sachs Asset Management (GSAM) has debuted a new exchange-traded fund aimed at delivering low-cost smart beta exposure to corporate bond markets. 

The new fund, named the Goldman Sachs Access Investment Grade Corporate Bond ETF, is the first in the Access family and will trade under the ticker GIGB, the company said in a statement. GIGB seeks to track the Citi Goldman Sachs Investment Grade Corporate Index, which uses a transparent, rules-based methodology designed to exclude bonds with the greatest potential to default or deteriorate in price. 

GIGB began trading on NYSE Arca today with an initial $50 million in assets and is priced to investors at 14 basis points.

“This is a unique opportunity to revolutionize the fixed income ETF space, providing investors with exposure to bond markets while seeking to deliver smoother performance at a lower cost,” said Michael Crinieri, GSAM’s global head of ETF strategy, in the statement. 

“Investors need a smarter choice evaluating the overall health of companies,” added Jason Singer, portfolio manager for GIGB. “By screening for both liquidity and fundamental factors, the index seeks to limit exposure to illiquid, volatile and underperforming assets.”

GSAM began offering ETFs in September 2015 with the launch of the Goldman Sachs ActiveBeta U.S. Large Cap Equity ETF. Until GIBG, the group’s most recent launch was the Goldman Sachs Hedge Industry VIP ETF (GVIP), an ETF seeking to track Goldman Sachs’ proprietary Hedge Fund VIP Index. It now has ETFs with $4.1 billion in assets under management as of May 31, 2017.

GSAM is the asset management arm of Goldman Sachs, which supervises more than $1.17 trillion in assets.  The unit offers investment strategies across a broad range of asset classes to institutional and individual clients globally. 

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