JP Morgan Saudi Arabia Aggregate Bond UCITS ETF

Launched by State Street Global Advisors Europe on the 11^th December 2024, the Ireland-domiciled JP Morgan Saudi Arabia Aggregate Bond UCITS ETF (exchange traded fund) is a sub-fund of SSGA SPDR ETFs Europe I – with initial subscriptions currently open till the 14^th May 2025.

This total return fund tracks the performance of liquid, US dollar-denominated sovereign and quasi-sovereign instruments – including fixed-rate, floating and zero-coupon bonds – plus Saudi riyal-denominated Sukuk and government bonds from Saudi Arabia issued after the 1^st January 2023.

Saudi Arabia’s Public Investment Fund has invested US$200 million in this fund, revealed deputy governor Yazeed Al-Humied, as it “further deepens the Saudi market, while attracting investors and strengthening cross-geography partnerships, increasing international investment in Saudi Arabia”.

Described as the first internationally listed fixed-income Saudi Arabian ETF, total fund assets stood at US$240.8 million as at the 8^th January 2025 – with investments in three Saudi Arabian government Sukuk and seven government bonds. These have maturities ranging from 2027 to 2054.

Classified as medium risk, the fund’s investments follow a stratified sampling strategy referencing the monthly-balanced JP Morgan Saudi Arabia Aggregate Index.

The US dollar-denominated bonds have to satisfy the minimum amount outstanding criterion of US$500 million while the minimum for riyal bonds is US$1 billion. At each month-end, instruments that fall below six months to maturity during the upcoming month, will be excluded from the index.

Up to 10% of the fund’s net assets can be invested in other regulated open-ended funds, including money market funds plus ancillary liquid assets such as deposits. Financial derivative instruments can be used for currency hedging – limited to futures and forward foreign exchange contracts.

The fund is open to investors in 12 European countries – Austria, Denmark, France, Finland, Germany, Italy, Luxembourg, the Netherlands, Norway, Spain, Sweden and the UK. The fund manager will generally only issue and redeem shares to certain institutional investors. However, fund shares may be traded through brokers on the London Stock Exchange and Deutsche Borse.

While distributing share classes may see dividends declared twice yearly in January and July, the accumulating share classes will have the income retained automatically to increase capital values.

*Disclaimer:  The opinions and viewpoints expressed in the Fund Profile do not constitute as a recommendation for any funds highlighted. The information presented is not investment advice and should not be treated as such. 

Source: State Street Global Advisors Europe