PSX launches ETF to attract fixed income investors

KARACHI: Pakistan Stock Exchange (PSX) on Friday notified launching of HBL Total Treasury Exchange Traded Fund (HBLTETF), seventh ETF on the exchange, attracting investors to invest in fixed income government debt securities.

The fund would be listed on the exchange w.e.f. Monday, September 12, 2022 and trading in the units of the ETF would commence from the same day in the ready delivery contract market through Karachi Automated Trading System (KATS), PSX press release stated.

The units of the ETF would be available in a market lot size of 500 units with a face value of Rs10/each. The circuit breaker shall be applicable as provided under Chapter 19 of the PSX Rule Book, the release added. The fund is managed by Habib Bank Limited (HBL) Asset Management Limited.

Speaking at the launch, managing director and CEO of PSX Farrukh H. Khan, said, “The launch of the seventh ETF on PSX, the HBL Total Treasury ETF, is an important and exciting development for the stock market, investors and all stakeholders.”

He stated that introduction of HBLETF was part of PSX and the mutual fund industry’s effort to provide a wide range of low-cost ETFs for investors, allowing them to easily take exposure to different asset classes and investment strategies.

“This ETF is the first of its kind. Investors can now easily invest in a diversified pool of fixed-income government debt securities by doing a single trade through their brokers on the ready counter of the exchange. Hence, investing in government securities is now as easy as investing in shares on PSX."

The fund’s underlying assets consist of cash and cash equivalent, Treasury Bills (T-Bills) and Pakistan Investment Bonds (PIBs). It is an open-ended fixed income ETF, which tracks its benchmark index, the HBL Total Treasury Index (HBLTTI).

According to PSX, the ETF aims to track performance of the HBL Total Treasury Index (“HBLTTI” or the “Benchmark Index”).