Fidante Slashes Transaction Costs in Ardea Real Outcome Bond Complex ETF Update

Background and Update

Fidante Partners Limited, the Responsible Entity for the Ardea Real Outcome Bond Complex ETF (ASX, XARO), has released a replacement Product Disclosure Statement (PDS) dated 11 December 2025. This updated document supersedes the previous PDS issued in November 2024 and primarily reflects a reduction in the Fund's net transaction costs from 0.40% to approximately 0.32% per annum of the Net Asset Value (NAV).

The Fund's investment objective, strategy, and management fees remain consistent with prior disclosures, underscoring Fidante's commitment to stability and transparency for investors.

Investment Strategy and Management

The Ardea Real Outcome Bond Complex ETF is managed by Ardea Investment Management, a specialist fixed income manager known for its pure relative value approach. This strategy seeks to exploit pricing inefficiencies between related fixed income securities, independent of prevailing interest rates or bond market trends.

Capital preservation and inflation protection are central to the Fund’s mandate. It achieves this by investing predominantly in high-quality government bonds, related derivatives, and cash equivalents, with a strict limit of no more than 10% of NAV in derivatives. The Fund aims to deliver consistent, volatility-controlled returns that exceed Australian inflation over the medium term.

Operational and Regulatory Framework

The Fund operates as a separate class of units within the ActiveX Trust and is quoted on the ASX AQUA market, which offers greater flexibility tailored to managed funds and ETFs. Only Authorised Participants; typically institutional investors or market makers; can create or redeem units directly with the Fund, while retail investors access liquidity through secondary market trading on the ASX.

Fidante continues to oversee the Fund’s operations, supported by MUFG Corporate Markets as Unit Registrar and an appointed market maker to maintain liquidity. The replacement PDS also reiterates compliance with regulatory requirements, including continuous disclosure obligations and adherence to the Corporations Act.

Fees, Costs, and ESG Considerations

The management fee remains at 0.50% per annum of NAV, with no performance fees charged. The reduction in transaction costs is a notable improvement, potentially enhancing net returns for investors. The Fund also maintains a modest buy/sell spread of +/-0.05% to cover transaction expenses.

Environmental, social, and governance (ESG) factors are integrated into the investment process by Ardea, including a preference for Green Bonds and active engagement on climate-related risks. The Fund’s strategy includes stress testing for climate scenarios and a commitment to mitigating modern slavery risks within its investment and supply chains.

Investor Implications

For investors, the replacement PDS offers reassurance that the Fund’s core attributes remain intact while benefiting from lower transaction costs. The Fund’s focus on capital preservation and inflation protection, combined with its active relative value strategy, positions it as a compelling option for those seeking stable fixed income exposure with daily liquidity on the ASX.

However, the restriction of direct unit creation and redemption to Authorised Participants may limit some investors’ flexibility, emphasizing the importance of secondary market liquidity and the role of market makers.