Enhancing Australian Fixed Income Indexing

Photo of Jing Jia
Written By Jing Jia
Photo of Jing Jia

Jing Jia

Jing is responsible for managing fixed income and money market solutions at Betashares. He specialises in developing innovative ETF products that provide institutional-grade investment solutions, with particular focus on credit income, to retail and wholesale investors. Jing regularly contributes market commentary, research and educational content on fixed income and portfolio construction. Prior to Betashares, Jing held investment management roles at Australian Unity and Altius Asset Management, where he managed fixed income and money market portfolios while contributing to strategic and tactical asset allocation decisions across multiple asset classes. Jing is a CFA® charter holder, a member of CFA Society Australia, and holds a Bachelor of Commerce degree (majoring in Actuarial Science) from the University of Melbourne.

Markets

26 March 2025

1 minutes reading time

For many Australian investors, traditional fixed income is a challenging asset class to navigate, which has led to an over-reliance on broad, simplistic market indices that are arguably inefficient as an investment strategy or for performance benchmarking.

The two main culprits causing the inefficiencies in these traditional benchmarks are liability-weighted indexing and the inclusion of bonds with less than one year to maturity.

To address these shortcomings, in partnership with Bloomberg, Betashares has co-developed the Bloomberg Australian Enhanced Yield Composite Bond Index, which the Betashares Australian Composite Bond ETF (ASX: OZBD) aims to track.

In this paper we discuss why we assert that this index provides a superior and more optimised solution for benchmarking fixed-rate bonds denominated in Australian dollars (AUD).

Read the full paper here.

This article mentions the following funds

OZBD

Australian Composite Bond ETF
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Attractive income from diversified Australian bonds
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Photo of Jing Jia

Written By

Jing Jia
Portfolio Manager
Jing is responsible for managing fixed income and money market solutions at Betashares. He specialises in developing innovative ETF products that provide institutional-grade investment solutions, with particular focus on credit income, to retail and wholesale investors. Jing regularly contributes market commentary, research and educational content on fixed income and portfolio construction. Prior to Betashares, Jing held investment management roles at Australian Unity and Altius Asset Management, where he managed fixed income and money market portfolios while contributing to strategic and tactical asset allocation decisions across multiple asset classes. Jing is a CFA® charter holder, a member of CFA Society Australia, and holds a Bachelor of Commerce degree (majoring in Actuarial Science) from the University of Melbourne. Read more from Jing.
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