Betashares has announced a new addition to its cash and fixed income range with the launch of the Betashares Australian Cash Plus Fund (managed fund) (ASX: MMKT).
The ETF provider explained that MMKT provides exposure to a diversified portfolio comprising Australian dollar cash and short-term money market securities.
“The money market securities in the portfolio mostly have three months or less to maturity and are issued by investment grade entities,” Betashares said.
“The fund will aim to generate a yield (before fees and expenses) in excess of the Bloomberg AusBond Bank Bill Index, with distributions paid monthly.”
According to Betashares chief executive officer Alex Vynokur, the new fund is suitable for investors who are looking to make their cash work harder within their portfolio.
“Investors and their financial advisers will be able to use MMKT to gain access to a compelling solution for the cash allocation of their investment portfolios,” he said.
“The fund provides access to high-quality securities with enhanced yields that are generally only available to institutional investors.”
By trading on the ASX like a share, Betashares indicated that MMKT provides investors with ready liquidity in the form of T+2 settlement.
This, the firm said, allows investors to obtain enhanced yields while maintaining a high degree of capital stability and not needing to lock up their money for extended periods.
Betashares suggested that the launch of MMKT comes at a particularly relevant time for cash solutions globally.
It pointed out that money market funds in the US have grown significantly over the past year, as investors have sought to benefit from rising interest rates and to preserve capital amid volatility in other asset classes.
According to data from ICI and Bloomberg, US money market assets have grown from approximately US$4.7 trillion to US$5.7 trillion during 2023 and cumulative flows to these funds have totalled approximately US$1.1 trillion in the past 12 months.
MMKT will sit alongside a number of other cash and fixed income solutions currently offered by Betashares, including its Australian High Interest Cash ETF (ASX: AAA), which has amassed $3.5 billion in funds under management since launching in 2012.
The Betashares Global Cash Flow Kings ETF (CFLO) is expected to begin trading on the ASX later this month and will seek to provide investors with exposure to a portfolio of global companies with “strong and consistent free cash flow generation”.
Jon Bragg is a journalist for Momentum Media's Investor Daily, nestegg and ifa. He enjoys writing about a wide variety of financial topics and issues and exploring the many implications they have on all aspects of life.