SSGA Launches Fixed Income ETF Built on Liquidity

LQIGwhich began trading on NYSE on May 12, is designed to provide bond investors with access to U.S. corporate bonds with higher relative liquidity and marketability. The new fund offers investors exposure to credit with the potential for tighter bid-ask spreads, lower premiums/discounts and greater transparency in real-time valuations of underlying holdings, according to a statement. of the society.

“The growth in the volume of electronic bond trading, coupled with the growing adoption of fixed income ETFs, is bringing the benefits of bond liquidity to all investors,” said Rory Tobin, global head of SPDR ETFs business at State Street Global Advisors, said in a statement. “Given State Street’s legacy as a liquidity leader in the ETFs market, we are delighted to be working with MarketAxess, one of the world’s largest electronic fixed income trading platforms, to launch LQIG.”

the SPDR MarketAxess Investment Grade 400 Corporate Bond ETFs seeks to track the MarketAxess US Investment Grade 400 Corporate Bond Index, a more data-driven approach to indexing.

The index measures the performance of 400 high-quality US dollar-denominated corporate bonds with above-average liquidity relative to the broader US corporate bond market. Powered by MarketAxess proprietary liquidity and pricing data – Relative Liquidity Score and Composite+™ Pricing Engine – the index combines actionable liquidity with broad market exposure. MarketAxess’ data capabilities support real-time pricing, liquidity assessment and valuation, enabling greater transparency and tradability, according to a company statement.

“Most bond indices are designed to reflect an investment with broad market exposure and not for tradable products where the underlying constituents are regularly available. In contrast, the MarketAxess US Investment Grade 400 Corporate Bond Index, launched last month, prioritizes liquidity, transparency and high availability of constituent bonds,” said Chris Concannon, president and chief executive officer. operation of MarketAxess, in a press release.

“We believe that the launch of LQIG will be instrumental in supporting increased tradability in the traditionally fragmented and less liquid fixed income market,” Concannon added.

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