ETF Watch: Global X Launches 3 Niche Funds

September 13, 2016

Today Global X is rolling out three niche ETFs on the Nasdaq stock exchange that target specific slices of developed markets. The three funds each track indexes provided by Indxx and come with expense ratios of 0.68%.

The Global X FinTech Thematic ETF (FINX) tracks an underlying index that covers developed-market companies that operate in any one of six financial technology areas: mobile payments; peer-to-peer and marketplace lending; enterprise solutions; blockchain and alternative currencies; crowdfunding; and personal finance software and automated wealth management/trading, the prospectus said. Companies must have market capitalizations of at least $100 million and meet liquidity requirements to be included in the index. The index uses a modified market-capitalization-weighting scheme, which keeps smaller companies from being overwhelmed by the larger ones.

The Global X Internet of Things Thematic ETF (SNSR) is based on the concept of devices, vehicles and buildings that—via sensors, software and other technology—are connected to the internet and able to process and transmit data. As with FINX, SNSR’s index has a minimum market-capitalization requirement of $100 million and liquidity requirements, and targets developed markets. It also uses a modified market-cap-weighting approach.

Components must fall into one of four categories, according to the prospectus: consumer internet-of-things technology; equipment, vehicle and infrastructure/building technology; semiconductors and sensors; and networking infrastructure/software.

The Global X Robotics & Artificial Intelligence Thematic ETF (BOTZ) tracks a similarly structured index, but its components must fall into another four buckets: industrial robotics and automation; nonindustrial robotics; unmanned vehicles and drones; and artificial intelligence.

SNSR is really the first ETF to target the “internet of things” theme, but the other two funds each have direct competitors. At the end of August, PureFunds rolled out the PureFunds Solactive Fintech ETF (FINQ), and the $100 million ROBO Global Robotics and Automation Index ETF (ROBO) rolled out in 2013.

Contact Heather Bell at [email protected].

 

 

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