The African Domestic Bond Fund is the world’s first multi-jurisdictional fixed income Exchange Traded Fund (ETF) on the African continent.
The ADBF primarily invests in local currency government and quasi-government bonds of African countries. As an exchange traded bond fund, it seeks to provide investment returns that corresponds closely to the total return of the AfDB/AFMISM Bloomberg® African Bond Index 25% Capped ("Index"), before fees and expenses, though its return may deviate from that of the Index since up to 20% of its net assets may be invested in securities not forming part of the index.
The outlook for Africa is very positive for long term investors and is highlighted by the rising consumer, demographic, and infrastructure development stories.
With improved macroeconomic policies, debt metrics and sustained, strong GDP growth across the majority of Africa, coupled with falling inflation and easier monetary policies in general, the African local currency fixed income asset class continues to generate significant interest. Despite this, it remains generally underinvested by global institutional investors.
ADBF seeks to provide exposure to the pan-African bond markets, via a low cost, liquid and transparent vehicle.
ADBF benefits significantly from having the support of strong institutions such as the African Development Bank (AfDB). The AfDB is an anchor investor and sponsor in the fund. As the continent’s premier Development Bank, the AfDB is in a privileged position to lead, coordinate and drive the necessary inter-institutional effort needed for this initiative to be successful.
AfDB, along with other partner development financial institutions (DFIs) investing in the fund, looks to the fund to:
- Reduce African countries dependency on foreign currency denominated debt,
- Encourage the deepening of domestic bond markets through investments in longer dated debt, and
- Contribute to enlarge the investor base in African domestic bond markets.
The Manager is also responsible for the fund’s NAV calculation.
ADBF Daily NAV
Price as at: 11 Jan 2021