State Street launches first Australian active ETFs

State Street Investment Management has launched its first active ETFs in Australia in partnership with private credit manager Blackstone. 

State Street Blackstone Senior Loan (AUD Hedged) Active ETF (SBSL) and State Street Blackstone High Income (AUD Hedged) Active ETF (SBHI) are set to list on the ASX on 7 August.  

SBSL seeks to provide exposure to primarily sub-investment grade floating rate senior secured bank loans, while SBHI is an income-focused ETF that seeks to provide exposure to a dynamic allocation across liquid credit markets. 

Both vehicles are feeder funds that invest in two existing US ETFs – the US$5.2 billion State Street Blackstone Senior Loan ETF and the US$569 million State Street Blackstone High Income ETF – which launched in 2013 and 2022 respectively. 

Developed in collaboration with Blackstone, SBSL and SBHI offer investors access to Blackstone’s credit expertise, proprietary research, and scale, delivered through a transparent and liquid ETF structure. 

State Street Investment Management will have a total of 19 ETFs listed on the ASX following the addition of the two new ETFs. August also marks 25 years since it listed the first ETFs in Australia, the State Street SPDR S&P ASX 200 ETF and State Street SPDR S&P ASX 50 ETF. 

Flora Herries, head of APAC product at State Street Investment Management, said: “SBSL is the first ETF in Australia primarily allocating to US senior loans, offering investors access to the $2.87 trillion segment of the US corporate credit market. 

“With bank hybrids being gradually phased out, many investors are seeking alternative high yield solutions. These ETFs offer attractive income opportunities by accessing the higher yielding segments of the corporate bond market.” 

Dan Leiter, global head of liquid credit strategies and head of international for Blackstone Credit & Insurance, said: “We are pleased to partner with State Street to expand access to liquid credit in Australia, a market with deep significance to our investment history and longstanding relationships, and to introduce new products that channel our expertise across our $185 billion global liquid credit platform.  

“This partnership underscores our commitment to broadening our credit capabilities for a diverse investor base across the Asia Pacific region, where we continue to expand our platform and teams.”