State Street Global Advisors (SSGA), the asset manager behind the SPDR range of exchange-traded funds, has announced changes to its international government inflation-linked bond ETF. The ETF has adopted the Citi International Inflation-Linked Securities Select Index as its underlying reference benchmark, ditching the DB Global Government ex-US Inflation-Linked Bond Capped Index, following Deutsche Bank’s decision to discontinue its index calculation and administration services business.
SSGA have teamed up with Citi Group who will provide index calculations for the SPDR Citi International Government Inflation-Protected Bond ETF.
Following the switch, the ETF has been renamed SPDR Citi International Government Inflation-Protected Bond ETF (WIP).
“We continually review our offering to identify new or improved ways to access the market in order to provide the best solutions to our clients,” said James Ross, executive vice president and global head of SPDR Exchange Traded Funds at State Street Global Advisors.
“We are excited to continue to offer investors efficient access to inflation-linked bonds outside of the US with this index from Citi.”
The Citi International Inflation-Linked Securities Select Index tracks the performance of fixed-coupon government bonds, listed in both developed and emerging markets outside the US, that are linked to an inflation index. There are 15 sovereign debt issuers denominated in 13 currencies within its constitution. Single country caps of 22.5% are applied while a cap of 45% of total portfolio value is applied to the sum of all countries who individually account for over 4.6% market weight. After the country weights are determined, constituents within each country are assigned weights in proportion to their market capitalization.
The new index maintains a similar strategy to the original Deutsche Bank index with slight adjustments to country and currency exposure.
The fund remains listed on the NYSE Arca with the same ticker (WIP) and continues to charge ongoing fees of 0.50%.