Simplify Launches Bond ETF for Emerging Markets

Following a waiver, GAEM has a net expense ratio of 0.76%. Per the fund prospectus, this waiver is slated to last at least through October 31st, 2025.

GAEM is an actively managed ETF that aims to provide both income and capital appreciation to investors. To do so, the fund invests in bonds that are either issued by or economically tied to emerging markets.

At least 80% of the fund’s assets are expected to be focused on debt securities of issuers in emerging markets. In particular, the fund prospectus notes that GAEM intends to possess exposure to assets within Latin America and the Caribbean. However, the fund may also invest in markets outside of that region.

Primarily, the fund will invest in bonds that are either denominated in the U.S. dollar or local currency. Any non-dollar investments may be hedged back to the U.S. dollar through derivatives, though the fund is not required to do so. A smaller portion of GAEM’s assets may also be invested in debt securities outside of emerging markets.

To achieve its investment objectives, GAEM may include investments in high-yield bonds. While junk bond exposure does increase the risk of default, the fund’s active management can help GAEM mitigate risk amid economic or market strife.

An opportunistic and tactical approach is utilized when it comes to selecting assets for the fund. Additionally, GAEM does not limit itself to investing in securities of a particular duration, maturity range, or credit region.

When evaluating emerging market countries for investment, the fund utilizes a top-down macroeconomic analysis. For corporate issuers, GAEM opts to apply a bottom-up analysis.

With the launch of GAEM, Simplify now has nearly 30 ETFs that are listed in the United States. As a whole, these funds represent over $5.5 billion in assets under management.

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