Wealth Manager - the site for professional investment managers

Register to get unlimited access to all of Citywire’s Fund Manager database. Registration is free and only takes a minute.

State Street redomiciles £1.1 billion range in cost drive

State Street redomiciles £1.1 billion range in cost drive

State Street Global Advisors (SSgA) is to merge a seven-strong £1.1 billion Irish-registered bond tracker range into an equivalent Luxembourg-domiciled range in a bid to lower costs.

The suite of trackers include the £26 million EMU Government Bond Index fund; £101 million US Corporate Bond Index fund; £153 million EMU Government Long Bond Index fund; £255 million Euro Inflation Linked Bond Index fund; £68 million World Government Bond Index fund; £358 million World Broad Investment Grade Bond Index fund; and £165 million Euro Corporate Bond Index fund.

State Street already has products of the same name registered in Luxembourg for four of the funds – EMU Government Bond Index, World Government Bond Index, World Broad Investment Grade Bond Index, Euro Corporate Bond Index – and will launch new vehicles for the other three.

A State Street spokesperson told Wealth Manager: ‘The merging of seven SSgA Dublin bond products into Luxembourg Sicavs is a move aimed at achieving better levels of operational efficiency, and longer-term cost savings for clients of both the merging and the receiving funds.’

As an example of the potential for cost savings, State Street said that fixed costs were expected to decline as a percentage of assets under management in the larger combined funds. The group added that higher levels of operational efficiency were likely be realised as a consequence of the reduced operational and administrative burden.

State Street argued too that the expanded investor base for the merged funds would reduce the risks posed by large redemptions from single unitholders.

The costs of implementing the transition will be borne by State Street, not the funds themselves.

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Citywire TV
Play Volatility is back, Europe's future & Ethical's key moment

Volatility is back, Europe's future & Ethical's key moment

This week’s episode of Investment Pulse takes a look at European prospects, FTSE volatility and whether public pressure is about to provide a push for ethical investment

Play Volatility spike: How ETFs can soften the blow

Volatility spike: How ETFs can soften the blow

ETFGI’s Deborah Fuhr discusses the role of ETFs in client portfolios during volatile market conditions

Play Winter market warmers, the post QE world and timing the Fed

Winter market warmers, the post QE world and timing the Fed

This week’s episode of Investment Pulse looks at the winding down of quantitative easing, whether to try and time a US Federal Reserve rate rise and if strong seasonal performers can reverse recent market slumps

Wealth Manager on Twitter