- Exchange-traded Treasury Indexed Bonds
Exchange-traded Treasury Indexed Bonds
Disclaimer: Please note that the information on this website does not constitute investment advice. You should obtain independent financial advice before buying Exchange-traded Treasury Indexed Bonds.
What are Exchange-traded Treasury Indexed Bonds?
Exchange-traded Treasury Indexed Bonds (eTIBs) offer a convenient and readily accessible way to invest in Treasury Indexed Bonds. eTIBs are quoted and traded on the Australian Securities Exchange (ASX).
An eTIB Holder has beneficial ownership of Treasury Indexed Bonds in the form of CHESS Depositary Interests (CDIs). This means obtaining all of the economic benefits (including coupon and principal payments) attached to legal ownership of the Treasury Indexed Bonds over which the CDIs have been issued.
A one unit holding of an eTIB provides beneficial ownership of $100 Face Value of the Treasury Indexed Bond over which it has been issued.
Why invest in Exchange-traded Treasury Indexed Bonds?
- The payment of coupon interest and repayment of principal at maturity is made by the Australian Government.
- Regular income
- Coupon Interest Payments are made every three months.
- Inflation protection
- eTIBs provide protection against inflation (as measured by an increase in the Consumer Price Index (CPI)) as both Coupon Interest Payments and the capital value payable at maturity increase in line with changes in the CPI.
- Liquid investment
- eTIBs can be sold any time the ASX market is open. This means your money is not locked away like it might be in some other interest earning investments.
- eTIBs may provide you with an opportunity to diversify your investment portfolio.
- Choice of maturities
- There is a wide range of eTIBs available extending out to 2040.
How to invest in Exchange-traded Treasury Indexed Bonds?
eTIBs can be bought and sold on the ASX in the same way as listed shares. For more information please see Buying and Selling Exchange-traded eTIBs.