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ECRD and the AI tech wreck

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Question asked 21/02/2026

ECRD and the AI tech wreck

James and Team, I've tried and been courted by many research providers / houses but nothing has come close to the service MM provides and I have done very well following your advice and will continue to be a member for a long time. I have two questions, first one is the new Income ETF ECRD . It is quoting a yield above 7s with a credit rating of A-, what is your view of this new product. It seems very generous when you consider the ASX dividend yields. Do you have a view on the risk of this product. Second is the AI tech wreck we have seen in the last week. After trumps tariff calls last April buying the dip paid great dividends particularly with tech, but now seeing WTC at under $50 and PME at $118 it should scream buy given their historical levels. Forgive the naivety, now 10 months later, is this threat of AI destroying SaaS business models, breaking long term contractual businesses relationships and years of R and D as real as it seems or has the fear overtaken the reality. Thanks

Answer

Hi Michael,

Thanks for the kind words, it makes all the effort worth it. Great to hear, and puts a big smile on our faces.

The BetaShares Australian Enhanced Credit Income Complex ETF (ECRD) is a new ETF having only traded since November 2025 which as you say is forecast to yield ~7.1% pa unfranked with dividends paid monthly.

The yield is higher because it’s a geared product i.e. they borrow to invest in a portfolio of Australian investment-grade credit, including corporate bonds and major bank subordinated debt. It typically invests via other BetaShares bond ETFs and borrows at institutional rates to increase exposure, with the goal of boosting returns.

This strategy carries higher risk than a standard bond fund. Gearing increases both gains and losses, making returns more volatile. The fund is also exposed to some credit risk, market risk and the added risks of subordinated bank bonds, which rank lower in a default – but that would be highly unlikely. We like tier 2 bank bonds at the moment, believing their near ~6% yield is attractive.

Over time, the effects of gearing can cause returns to differ from expectations, so it may not suit conservative investors, but we believe it will deliver solid returns.

We believe the “Tech Wreck” is different this time with uncertainty around the impact of AI upon SaaS business models likely to linger until proven otherwise, and markets hate uncertainty. We do believe that “fear has overtaken reality” at least for now but confidence and high growth valuations may take years to return. This is a topic we specifically covered in a Webinar this week – Recording here.

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BetaShares Australian Enhanced Credit Income Complex ETF (ECRD)

LAST UPDATED 19/02/2026 12:13

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