ProShares, the Bethesda, Md.-based firm known for its inverse and leveraged strategies, today launched an ETF focused solely on debt issued by the German government, the latest sign of investor interest in financially sound developed countries following a similar product rollout by Pimco in November.

The ProShares German Sovereign/Sub-Sovereign ETF (NYSEArca: GGOV) comes with a 0.78 percent total expense ratio, but it has a fee waiver of 0.33 percent through Jan. 25, 2013. In other words, in the first year of its existence, investors in GGOV will pay 0.45 percent, or the same as Pimco’s competing product focused on the German sovereign debt market.

GGOV will invest in investment-grade fixed-rate debt securities issued by Germany’s federal government in addition to securities from German local and government-backed agencies. The bonds must have a minimum principal outstanding of $1 billion and have at least one year to maturity.

Investors are taking an increasing interest in developed-country bond funds from super-safe countries such as Germany, Australia and Canada as a way to hedge their bets against recent uncertainties in the world economy. Adding to the appeal is the fact that Germany was one of the few eurozone countries with an AAA credit rating from Standard & Poor's, which downgraded nine eurozone countries earlier this month.

Bond funds that focus on Germany are relatively new. In November, Pimco launched the Pimco Germany Bond Index Fund (NYSEArca: BUND), one of three super-stable developed-country funds. Bund currently has $12.5 million in assets under management and consists of a portfolio of both government and private credits issued by different German entities. It comes with an annual expense ratio of 0.45 percent.

There are also other Germany-focused, debt-type exchange-traded products coming on the market, such as the PowerShares DB German Bund Futures ETN (NYSEArca: BUNL). It has $30.5 million in assets under management, while the triple-exposure PowerShares DB 3X German Bund Futures ETN (NYSEArca: BUNT) has $34.0 million in assets under management. BUNL, the single-exposure ETN, has an expense ratio of 0.50 percent, and BUNT, its triple-exposure counterpart, costs investors 0.95 percent a year.

GGOV uses a mathematical formula to determine the type, quantity and mix of investment positions that the fund should hold to approximate the performance of its underlying Markit iBoxx EUR Germany Sovereign & Sub-Sovereign Liquid Index.

GGOV’s fund managers may gain exposure to just a representative sample of the securities in the index, which are intended to have aggregate characteristics similar to those of the index. Sampling, or optimization, means not all index constituents are held in the fund.

Also, GGOV will invest at least 80 percent of its total assets in securities of the index.

In addition, the fund will invest in derivatives and other fixed-income securities that ProShares believes should have similar return characteristics as the returns of the index.