SPDR plans to launch emerging markets short-term government bond ETF

By Toni Weeks

San Luis Obispo, Calif., Feb. 5 – SPDR Series Trust announced in an N-1A filing with the Securities and Exchange Commission that it is planning to offer a new fixed-income fund targeting emerging markets sovereign debt.

The SPDR BofA Merrill Lynch Short Term Emerging Markets Government Bond ETF will seek to provide investment results that, before fees and expenses, correspond generally to the price and yield performance of the BofA Merrill Lynch 0-5 Year Emerging Markets Government Bond index, which tracks emerging market short-term dollar-denominated sovereign debt publicly issued in the U.S. and eurobond markets.

Under normal market conditions, the fund will invest at least 80% of its total assets in the securities comprising the index. For inclusion in the index, an issuer must have risk exposure to a country other than a member of the FX-G10, a western European country, and a territory of the United States or a western European country.

The FX-G10 includes all euro members, the United States, Japan, the United Kingdom, Canada, Australia, New Zealand, Switzerland, Norway and Sweden.

Qualifying securities must have at least 18 months to final maturity at the time of issuance, between zero and five years remaining to final maturity as of the rebalancing date, a fixed coupon schedule and a minimum amount outstanding of $500 million.

Abishek Kumar, John Philpot and Victoria Husemeyer are the portfolio managers.

The ticker symbol has not yet been set.

Management fees and total annual fund operating expenses have not yet been disclosed.

Boston-based SSgA Funds Management will serve as the investment adviser to the fund.

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