Global X ETFs Launches Fixed Income ETF in Colombia

Global X ETFs, a New York-based provider of exchange-traded funds (ETFs), has launched Colombian Public Debt Stock ETF (GXTESCOL), the Andean country’s first fixed income ETF.

The new ETF, according to the US company that will serve as manager of the fund, will be dominated in Colombian pesos and function as an issue-driven exchange traded fund (ID ETF), a World Bank intended to “support the development of domestic capital markets in emerging economies by collaborating with local partners and allowing local currency debt to be packaged into an ETF format.”

Fiducaria Bogota will serve as administrator of the fund and J.P. Morgan will provide the fund’s reference index. Both of these decisions were announced by the Colombian Ministry of Finance.

Furthermore, Global X ETFs says that GXTESCOL “seeks to offer greater accessibility to the Colombian sovereign bond market in local currency to investors while tracking the total return” of the JP Morgan GBI-EM Colombia Government Local Currency Bond Index.

“The launch of the Colombian Public Debt Stock ETF (GXTESCOL) is part of the World Bank’s strategy to create a regional ID ETF in Latin America and then a global one for emerging countries,” said Mark Roland Thomas, Colombia country director at the World Bank, in a statement.

“We are sure that it will contribute to boosting the already developed local currency bond market and will serve as an example and inspiration for the adoption of this instrument by other countries. Supporting the development of the global capital markets is part of our mandate to end extreme poverty and boost prosperity on a livable planet.”

For it’s part, Federico Torresi, head of Latin American sales at Global X ETFs, added that “we are confident that GXTESCOL will help develop Colombia’s capital markets while democratizing its sovereign debt through increased accessibility.”