Betashares Launches ETF Tracking Solactive Global ex-Australia Cash Flow Kings Index Providing Investors Access to Leading Global Cash Flow Generators
Cash flow is a fundamental metric for evaluating the financial health and resilience of a business1. However, amid today’s volatile macroeconomic environment of high inflation, rising interest rates, and market uncertainty2, it can be difficult for companies to consistently generate stable cash flows and maintain a strong balance sheet. In this context, Solactive is pleased to announce that Betashares, a leading Australian fund manager, has expanded its engagement with the German index provider by launching the Betashares Global Cash Flow Kings ETF, which tracks the Solactive Global ex-Australia Cash Flow Kings Index.
The Solactive Global ex-Australia Cash Flow Kings Index tracks a portfolio of large- and mid-cap stocks from developed markets demonstrating strong quality attributes related to free cash flow. With a rule-based methodology, the index evaluates and selects companies with higher free cash flow generation, growth, stability, and lower leverage. The index aims to provide exposure to companies that have reliably generated healthy cash flows. It also encourages diversification by constraining sector and country exposures, while excluding the Australian home market to further distinguish from existing strategies.
The ETF started trading on 16 November 2023 on the Australian Securities Exchange with ticker “CFLO”.
Timo Pfeiffer, Chief Markets Officer at Solactive, commented: “We are delighted that Betashares has partnered with us again on our Global ex-Australia Cash Flow Kings Index for the launch of their new ETF in Australia. This decision underscores the ability of our index to identify global leaders renowned for what ultimately reflects business success – their cash flows. We believe this product will provide investors with an attractive risk-return profile with a tilt towards quality names that can also deliver a degree of protection during volatile market environments.”
Betashares CEO, Mr Alex Vynokur, said: “Cash flow is a measure that is often used by investors and analysts as an indicator of a company’s overall financial health and performance prospects. We believe that investing with a focus on cash flow is an intelligent approach offering the potential for outperformance versus traditional broad global equity benchmarks over time. In addition, because this fund will have similar sector and country weights to broad global equity benchmarks, our view is that CFLO can be considered as a compelling candidate for a core exposure to global equities.”
[1] A Resilient Balance Sheet Pays Off in Uncertain Times – Boston Consulting Group (BCG)
[2] Safeguarding Financial Stability Amid High Inflation and Geopolitical Risks – International Monetary Fund