PIMCO, the global investment management firm, has teamed up with exchange-traded fund specialist Source for the launch of a European fund exposed to the short maturity sector of the high yield universe in the US.

The PIMCO Short-Term High Yield Corporate Bond Index Source ETF is the first product of its kind in Europe to give physical exposure to the short end (up to five years) of the high yield corporate bond sector, according to its creators.

The London-listed ETF tracks the BofA Merrill Lynch 0-5 Year US High Yield Constrained Index and is available for sale in the UK, Ireland, Austria, France, Finland, Germany, Italy (for institutional investors only), Holland, Norway and Sweden.

UK-based Source said in a statement that returns of the short-term segment of the high yield market have historically been in line with equities, but with roughly half the volatility.