Amundi lists its US dollar-denominated emerging markets government bond ETF on the London Stock Exchange

From 7 May 2026, the Amundi USD Emerging Markets Government Bond UCITS ETF Acc (ISIN: LU1681041205) will be available on the London Stock Exchange (LSE).

Sign up to our free newsletters

Article created by the editorial staff of ETFWorld.co.uk

Benoit Sorel Global Head of ETF, Indexing & Smart Beta Amundi ETF

The fund tracks the J.P. Morgan EMBI Global Diversified Select Index with a TER of 0.25% and a capital accumulation structure.

This is a physically replicated index fund offering exposure to US dollar-denominated sovereign and quasi-sovereign debt from emerging markets.

The product, domiciled in Luxembourg and managed by Amundi Luxembourg SA — a company belonging to the Amundi group — was already tradable on other European exchanges, including Borsa Italiana. The listing on the LSE broadens accessibility for UK investors and for those trading through intermediaries with priority access to the London market.

The benchmark index: the J.P. Morgan EMBI Global Diversified Select

The ETF tracks the J.P. Morgan EMBI Global Diversified Select Index, identified on Bloomberg by the ticker JPEITRUS. This is a total return index: coupons paid on the constituent securities are reinvested in the performance calculation, as is the case within the fund itself, which has a policy of reinvesting income.

The index aims to track the performance of liquid dollar-denominated bonds issued by sovereign and quasi-sovereign issuers in emerging markets. To be included, securities must have an outstanding nominal amount of at least one billion dollars, and countries must reach a minimum of two billion dollars to pass the liquidity filter.

The diversification methodology is a key feature: the index limits the weighting of countries with higher debt stocks, including only a specified portion of the current nominal amounts of eligible debt outstanding. This mechanism reduces concentration on the largest debtors and distributes exposure more evenly across the included countries.

Fixed-rate, floating-rate and coupon-accumulating or amortising bonds are eligible. Bonds with embedded options and warrants are eligible for inclusion provided that prices are quoted on a cumulative basis. Convertible bonds, however, are excluded.

The J.P. Morgan EMBI Global Diversified limits the weighting of countries with larger debt stocks by including only a specified proportion of the current eligible outstanding nominal amount of those countries. Rebalancing takes place on the last working day of the month, in accordance with the Emerging Markets Traders Association (EMTA) calendar.

The index universe comprises sovereign issuers — national governments — and quasi-sovereign issuers, i.e. entities that are 100% guaranteed or wholly owned by a national government, resident in a country eligible for the index. An issuer is considered eligible if it meets the criteria based on gross national income per capita (Index Income Ceiling) or the purchasing power parity parameter (Index PPP Ratio) for three consecutive years.

Fund structure and replication method

The fund uses sampled replication: it invests directly in transferable securities and other eligible instruments that represent the index components, but is not required to hold every security in the index at all times, nor in the same proportions as the index itself. The Sub-Fund aims to achieve a tracking error relative to the index that does not normally exceed 1%.

The investment manager’s strategy includes the option to use derivatives to manage inflows and outflows, or to achieve more efficient exposure to specific index constituents. The fund may also engage in securities lending to generate additional income to offset costs.

The latest data indicates that the fund has assets under management of approximately €142 million (as of January 2026), making it the largest European ETF tracking the J.P. Morgan EMBI Global Diversified Select Index.

The main features of the product are summarised in the table below:

Feature Details

ISIN LU1681041205

TER 0.25% per annum

Benchmark index J.P. Morgan EMBI Global Diversified Select Index

Bloomberg ticker JPEITRUS

Income policy Accumulation

Tracking method Sampled physical

Domicile Luxembourg

Management company Amundi Luxembourg SA

Launch date 27 February 2018

Assets (Jan 2026) ~€142 million

Reference currency USD

Market context: why exposure to dollar-denominated emerging market debt is relevant in 2026

The listing on the LSE comes at a time when dollar-denominated emerging market sovereign debt is benefiting from a relatively favourable fundamental environment.

According to J.P. Morgan Asset Management, rating agencies are expected to announce more upgrades than downgrades for emerging markets. Since “Liberation Day”, emerging markets have shown resilience, with increased investor allocations and the best performances within the public fixed income sector.

In its May 2026 analysis, Amundi is positive on emerging market debt, although it has tactically reduced its weighting in Indian bonds, and favours an approach based on relative value across different yield curves rather than a directional bet on duration.

Within the overall macroeconomic picture, Amundi believes the emerging markets rally has room to continue in 2026: a weaker dollar, potential Fed rate cuts and the growth advantage of emerging markets support EM bonds for yield and, selectively, EM equities.

The main risks identified by Amundi for emerging markets remain a stronger US dollar and higher US Treasury yields. In such a scenario, a dollar-denominated ETF such as this one eliminates currency risk for investors thinking in USD, but introduces currency risk for those trading in euros or sterling without hedging.

Amundi’s emerging market debt offering: an overview

Amundi is Europe’s leading ETF manager by assets under management and has built up a comprehensive range of emerging market fixed income products over time. Alongside the accumulation class (LU1681041205), the family includes a distribution class (ISIN LU1686830909) and a class with euro currency hedging (ISIN LU1686831030, TER 0.27%), the latter aimed at European investors seeking to neutralise the dollar/euro risk.

The listing on the London Stock Exchange forms part of a broader distribution strategy that Amundi has actively pursued in the first half of 2026. By April 2026, Amundi had already listed the dollar-hedged class of its global ex-US government bond ETF on the LSE, completing the range of classes available to European investors for that product.

The choice of the LSE as the listing venue meets practical needs: the London market offers ample liquidity, an established pool of institutional investors and access to UK-based operators who, following Brexit, prefer to operate on regulated UK markets rather than on continental exchanges.

Risk profile and operational considerations

The fund is aimed at investors with a basic understanding of investment funds and a tolerance for losses potentially amounting to the entire capital invested. The main categories of risk include:

Interest rate risk. The portfolio consists of long-term bonds denominated in US dollars. A rise in US benchmark interest rates results in a reduction in the market value of the securities in the portfolio.

Credit risk. The index includes investment-grade, high-yield and unrated issuers. The default of an issuer — or even a simple deterioration in creditworthiness — may adversely affect performance.

Currency risk. For unhedged European investors, fluctuations in the EUR/USD exchange rate affect returns in local currency.

Emerging market risk. Emerging markets are subject to political volatility, regulatory uncertainty, liquidity risks and, in some cases, capital controls that may restrict the ability to transfer funds abroad.

Concentration risk. Although a diversification methodology is applied, the index may nevertheless be concentrated in certain countries or geographical areas during specific market phases.

The expected tracking error, under normal market conditions, does not exceed 1% on an annual basis, as indicated in the fund prospectus.

Conclusions

The listing of the Amundi USD Emerging Markets Government Bond UCITS ETF Acc on the London Stock Exchange from 7 May 2026 broadens access to an established instrument for investors seeking exposure to emerging market sovereign debt denominated in US dollars via a passive vehicle, with low costs (TER 0.25%) and transparent management based on physical sampling replication.

The underlying index — the J.P. Morgan EMBI Global Diversified Select — is one of the most widely followed benchmarks for this asset class, with a diversification methodology that mitigates the risk of concentration towards the largest issuers. The fund, which has been in operation since February 2018, has accumulated assets of approximately €142 million and is the largest ETF in Europe tracking this index class.

Against the backdrop of 2026, characterised by a cycle of emerging market credit upgrades, monetary policies that remain accommodative in many EM countries, and a dollar that Amundi expects to trend weaker in the medium term, the product is positioned as a tool that can be used both for portfolio diversification and to capture the carry offered by dollar-denominated emerging market sovereign debt.

Source: ETFWorld.co.uk