The launch of Perpetual Diversified Income Active ETF (ASX: DIFF) brings daily liquidity and no minimum investment to a tried-and-tested credit and fixed-income strategy. Perpetual’s Vivek Prabhu explains
- Find out about Perpetual’s new active ETF Perpetual Diversified Income Fund (ASX:DIFF)
- The case for active management in credit and fixed income
- Why credit belongs in your portfolio
Perpetual Diversified Income Active ETF (ASX: DIFF), which launches today, is an actively-managed, diverse portfolio of liquid, mainly investment-grade credit securities.
It’s the first time Perpetual’s trusted Credit and Fixed Income capability has been available via a convenient ASX-listed active ETF with no minimum investment and an open-ended structure.
DIFF is a unit class of Perpetual Diversified Income Fund (DIF), a managed fund with $2.4 billion in funds under management (at June 30, 2025) and a history of outperforming its benchmark over two decades.
It’s designed for investors seeking daily liquidity, reliable income and capital preservation via a portfolio of mainly investment-grade credit securities.
DIFF also offers exposure to assets that are difficult to access directly, such as senior debt and subordinated bank debt.
The fund combines disciplined security selection, defensive portfolio construction and day-to-day liquidity – without the constraints faced by passive index replication or the delays common to traditional unlisted funds.
It provides access to the same diversified income strategy managed by Perpetual’s Credit and Fixed Income team – a strategy that has operated continuously since 2004 through multiple credit cycles.
“We’re not blindly following an index,” says Perpetual’s head of credit and fixed income, Vivek Prabhu.
“We construct portfolios in a risk-aware fashion.”
How DIFF works
DIFF trades on the ASX like any other listed security, with no minimum investment and daily liquidity during trading hours.
It allows investors to access the same portfolio as the existing Diversified Income Fund manage fund, but in a format that offers:
- T+2 settlement – listed ETFs can be bought and sold on the ASX throughout the trading day, with settlement typically completed within two days.
- Intraday pricing – market makers provide real-time pricing and liquidity.
- No paperwork – for investors who have a stockbroking account, no extra forms need to be filled out.
This removes some of the friction associated with traditional fixed income investments like locking up cash in a term deposit or facing redemption restrictions from unlisted funds.
What it holds
DIFF invests in a broad range of credit assets, with exposures including:
- Senior debt issued by global banks and large companies – these sit at the top of the capital structure and offer greater security compared to other forms of debt or equity
- Subordinated debt – bank debt that ranks below senior debt in the capital structure but offers higher yields to compensate for the additional risk
- Selected hybrid bank securities – as regulators phase out the hybrids market, DIFF offers continued access to the asset class in a diversified way.
- Asset-backed securities like residential mortgages – the diversified nature of these asset pools spread risk across many individual loans.
The fund is designed for investors seeking predictable outcomes - including above cash rate returns, consistent income and capital preservation.
“DIFF is diversified by industry sector, geography, and much more diversified in the capital structure than its peers – and it can rotate between all these different elements,” says Prabhu.
About Vivek Prabhu and Perpetual Diversified Income Fund
Vivek is Perpetual’s Head of Credit & Fixed Income. He joined Perpetual in 2004 and has more than 30 years of experience in finance, investments, accounting, governance and risk management.
He has managed multi-billion-dollar fixed income, credit and currency portfolios and his role involves credit analysis, trade execution and portfolio construction.
Vivek’s Perpetual Diversified Income Fund (DIF) is designed for investors seeking daily liquidity, reliable income and capital preservation via a portfolio of predominantly high-quality, investment-grade credit securities.
The strategy is now also available as an ASX-listed active ETF (ASX: DIFF). DIFF is a unit class of DIF.
Find out more about ASX-listed Perpetual Diversified Income Fund (ASX:DIFF) here or the manage fund here.
Find out about Perpetual's credit and fixed income capabilities
Want to know more? Contact a Perpetual account manager
