Tabula Investment Management has launched the iTraxx Europe IG Bond Ucits ETF, offering passive exposure to the new iBoxx iTraxx Europe Bond index, which Tabula has developed in partnership with IHS Markit.
The innovative index combines the robust construction of an iBoxx bond index with the geographic and sector exposure of iTraxx Europe, the reference instrument for trading European investment grade corporate names via credit default swaps.
In contrast to the majority of European bond indices, which target EUR-denominated bonds from all issuers, the iBoxx iTraxx Europe Bond index only contains bonds from European issuers. Additionally, the index consists of fixed sector bands with equal weighting per issuer, to achieve a more diversified index. In contrast, some European investment grade bond ETFs have around 40% exposure to financials. The index also features a narrower maturity band than the majority of its competitors, targeting an average 5y maturity, to facilitate more efficient hedging if required.
Tabula is continuing to grow its pipeline of innovative passive fixed income solutions and will soon be expanding its range to include an inflation-linked product.
The Tabula iTraxx Europe IG Bond Ucits ETF is available now for trading on the LSE and will be available on Xetra from 10 Janaury 2020.