WisdomTree AT1 CoCo Bond UCITS ETF - USD
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General Objective
The fund seeks to track the performance of the iBoxx Contingent Convertible Liquid Developed Europe AT1 Index, which reflects the performance of Additional Tier 1 contingent convertible bonds issued by financial institutions from European developed markets.
Fund Exposure
The fund is exposed to fixed income asset class through Additional Tier 1 contingent convertible bonds denominated in EUR, USD, and GBP issued by European financial institutions. The index is market value-weighted and excludes CoCo bonds that do not meet WisdomTree's ESG criteria.
Risks
Investors should be aware that CoCos can be converted into equity or have their principal written down, potentially resulting in loss of investment. The behavior of the CoCo bond market in a systemic financial crisis is untested, leading to potential degradation of price and liquidity. Additionally, coupon payments on some CoCos are discretionary and can be cancelled, making CoCo products more volatile.