Fixed income ETFs with exposure to investment-grade corporate bonds are once again the fancy of UBS Global Asset Management, as the firm launches three medium-duration exposure funds onto the London Stock Exchange.

Fixed-income ETFs with exposure to investment-grade corporate bonds are once again the fancy of UBS Global Asset Management, as the firm launches three medium-duration exposure funds onto the London Stock Exchange.

The first, the UBS ETF - Barclays US Liquid Corporates 1-5 Years UCITS ETF, is GBP-hedged and protects investors against exchange rate fluctuations. Alternatively, the UBS ETF Barclays Liquid Corporates 1-5 Years UCITS ETF will give investors exposure to medium-duration US corporate bonds without currency protection. The latter will be available for trading in both US dollar and pound sterling.

Only last month, UBS GAM listed three fixed-income ETFs for full-duration exposure to the Barclays US Liquid Corporates Index. All of the six funds give investors exposure to corporate bonds issued in US dollars by companies based in the US.

UBS GAM decided to expand their currency-hedged income range following the success of the initial three funds, the firm said in a statement.

“Adverse foreign currency movements can have a major impact on returns when investing abroad, particularly in fixed income. It’s entirely plausible that the foreign currency in which the underlying bond is denominated could decline against your home currency to such an extent that it completely negates the returns the investor received from the bond's price return and coupon. This is a common concern for our clients, so the launch of [the funds] addresses this issue,” Andrew Walsh, head of UBS ETF sales, UK & Ireland, said.