J.P. Morgan Asset Management (JPMAM) has launched a sterling-hedged version of the BetaBuilders US Treasury Bond ETF launched earlier this month.
The hedged product, trading under the ticker BBTP, is now available on the London Stock Exchange. Like the first US Treasury product, BBTP aims to offer liquid, low-cost beta exposure to dollar-denominated treasury bonds issued by the US government across the full yield curve.
It will closely track the J.P. Morgan Government Bond Index United States at a total expense ration (TER) of 10bps.
John Adu, co-head of ETF distribution, said: "We're continuing to listen to and respond to clients' needs for a range of cost-efficient solutions that are geared towards this late cycle environment. This includes currency-hedged ETFs which can help asset allocators create more balanced portfolios, as they seek to navigate an evolving macro backdrop."
Mike Bell, global market strategist, added: "While the timing of the next downturn remains uncertain, many investors are starting to add in some portfolio hedges to help balance the riskier assets in their portfolio, as we move later into the economic cycle. By including some treasuries, investors are seeking to create a more balanced portfolio and help reduce overall portfolio losses when the next economic downturn eventually arrives.
"For UK investors thinking about incorporating US government bond exposure, they may want to consider hedging the currency risk, given the uncertainty around the outlook for sterling against the dollar."