There are three SONIA‑tracking ETFs in the UK, the three main options are and they’re all ultra‑low‑risk cash‑equivalents designed to mirror the Sterling Overnight Index Average (SONIA).
Below is a clean, structured comparison of the three SONIA ETFs currently available:
- Invesco GBP Overnight Return Swap (GONS)
- Xtrackers GBP Overnight Rate Swap (XSTR)
- Amundi Smart Overnight Return GBP Hedged (CSH2)
These are the only widely‑listed, liquid SONIA ETFs in the UK market today.
The SONIA ETF Landscape (UK)
1. Invesco GBP Overnight Return Swap UCITS ETF (GONS)
- Tracks SONIA via swaps
- Accumulating
- TER 0.10%
- Very low volatility
- Designed as a cash‑like parking place
2. Xtrackers GBP Overnight Rate Swap UCITS ETF (XSTR)
- Tracks Solactive SONIA Daily TR Index
- Distributing
- TER 0.10%
- One of the oldest and most established SONIA ETFs
3. Amundi Smart Overnight Return GBP Hedged (CSH2)
- Actively managed but still SONIA‑anchored
- Accumulating
- TER 0.10%
- Very large AUM (£8.5bn fund)
Side‑by‑Side Comparison (SONIA ETFs)
| Invesco GONS0.10% TER | Xtrackers XSTR0.10% TER | Amundi CSH20.10% TER | |
| Costs | |||
| TER | 0.10% | 0.10% | 0.10% |
| Replication | Synthetic swap | Synthetic swap | Active (cash+SONIA) |
| Income | |||
| Distribution | Accumulating | Distributing | Accumulating |
| Yield | — | 4.15% (semi‑annual) | — |
| Exposure | |||
| Index | SONIA swap | Solactive SONIA TR | SONIA+enhanced cash |
| Volatility | Very low | Very low | Very low |
| Fund Size | |||
| AUM | £5m | £175m | £8.5bn |
| Other | |||
| Currency | GBP | GBP | GBP (hedged) |
| Launch | — | 2007 | 2022 |
Sources:
Which one fits what purpose?
For pure SONIA exposure (cleanest tracking):
XSTR — longest track record, straightforward SONIA TR exposure.
For accumulating cash‑like growth:
GONS or CSH2 — both roll up returns.
For maximum scale & liquidity:
CSH2 — huge AUM (£8.5bn), extremely stable.
With markets at all time highs and with the world at war, it’s scary times to re-invest in shares.
The SNOWBALL wants to build a cash fund to re-invest when the next market crashes occurs, hopefully not too soon until the cash element has built accrued.
I am content, at the present time with the dividend stream for this financial year, so I am going to re-invest the income in a money market ETF, yielding around 4%.
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