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ETF Watch: WisdomTree Debuts Japan Sectors
ETF Watch

ETF Watch: WisdomTree Debuts Japan Sectors


WisdomTree rolls out five currency-hedged sector ETFs targeting the Japan market.

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Barclays Closes BXDB

On April 4, Barclays Bank PLC pulled the plug on its Barclays ETN+ Short B Leveraged Exchange Traded Notes (BXDB) as a result of a stop-loss termination event that occurred on that date, according to a statement from the bank.

A stop-loss termination happens when the intraday indicative value of the security falls to $10 or lower before the note matures. In this case, BXDB hit the redemption threshold at 9:33 a.m. EDT on April 4, according to the bank.

Therefore, holders of BXDB will receive a cash payment equal to the stop-loss redemption value on April 11.

BXDB launched in November 2009 and had a maturity date of Nov. 20, 2014, and currently manages just $1.6 million.


WisdomTree Debuts 5 Japan ETFs

WisdomTree rolled out five more currency-hedged Japan-focused ETFs focused on sectors to capitalize on the country’s growth story, according to an NYSE communique. The firm launched the WisdomTree Japan Hedged Equity Fund (DXJ | B-53) last year.

WisdomTree is hoping its latest proposed sector-focused offerings will capture investor interest the way DXJ has. The new funds and their proposed tickers include the:

The funds are the very first sector ETFs focused on the world’s No. 3 economy, and come with an expense ratio of 0.43 percent, after a fee waiver of 5 basis points. By comparison, DXJ has an annual expense ratio of 48 basis points.


State Street Global Advisors has put into registration a short-duration municipal bond ETF at a time when muni-bond ETFs are gaining ground after taking a beating in 2013 in the wake of the Federal Reserve’s first suggestion of tapering last spring.

The SPDR Nuveen S&P Short Duration High Yield Municipal Bond ETF will track the S&P Short Duration Municipal Yield Index, which measures the performance of both high-yield and investment-grade municipal bonds in the short-duration range of one to 12 years' maturity, according to a regulatory filing.

The index is a subset of the S&P Municipal Bond Index and includes publicly issued U.S.-dollar-denominated, fixed-rate, municipal bonds that have a remaining maturity or call date greater than or equal to one calendar month and have a minimum outstanding amount of $2 million.

Associated fees and tickers were not yet available for the fund.

Index Changes

iShares is tweaking the name of two “Core” bond funds as well as their respective indexes in the next two months.

Effective June 3, the iShares Core Short-Term U.S. Bond ETF (ISTB | B-67) will be renamed the iShares Core Short-Term USD Bond ETF, and its index will change from the Barclays U.S. Government/Credit 1-5 Year Bond Index to the Barclays U.S. 1-5 Year Universal Index, according to a regulatory filing.

Also, the Shares Core Long-Term U.S. Bond ETF (ILTB | B-98) will change its name to the 
iShares Core Long-Term USD Bond ETF, and its index will change from the Barclays U.S. Long Government/Credit Bond Index to the Barclays U.S. 10+ Year Universal Index.


DB Updates China Small-Cap Filing

Deutsche Bank has updated paperwork for its proposed db X-trackers Harvest China A-Shares Small Cap Fund (ASHS) to include fees for the offering, signaling the fund is likely to soon launch.

The proposed small-cap ETF is a riff on its successful db X-trackers Harvest CSI 300 China A-Shares Fund (ASHR), a first-to-market ETF that holds much-coveted physical shares of mainland securities. DB is hoping ASHS will have as much success as its predecessor, which now has $146 million since inception last November.

ASHS will track the CSI 500 Index, which is composed of the 500 smallest and most liquid stocks in the China A-share market. The fund will have an annual expense ratio of 0.80 percent, or $80 for every $10,000 invested, according to a regulatory filing.

Fee Drop

The annual expense ratio on the $20.7 billion Vanguard FTSE Developed Markets ETF (VEA | A-90) dropped 10 percent to 9 basis points from 10 basis points previously, according to a statement from the firm.

VEA’s expense ratio decline, a function of growing assets in the fund’s previous fiscal year, brings it in line with its smaller competitor, the $2.1 billion Schwab International Equity ETF (SCHF | A-96). The Schwab fund also has an annual expense ratio of 9 basis points.


Direxion Debuts 3x Gold ETF Pair

Direxion launched a bull-and-bear pair of triple-exposure futures-based gold ETFs on Thursday, April 3.

The funds, THE Direxion Daily Gold Bull 3X Shares (GLDL) and the Direxion Daily Gold Bear 3X Shares (GLDS) are futures-based and target only front-month contracts, according to the prospectus.

Because the funds are registered under the Securities Exchange Act of 1933, Direxion estimated the fund’s annual cost to investors at 1.56 percent. That estimate is based on total underlying assets in the fund of $50 million, and could change over time because of changes to assets as well as fee waivers set by the funds’ managers.


TrimTabs Asset Management, purveyor of the AdvisorShares TrimTabs Float Shrink (TTFS | B-77), is looking to strike out on its own. The firm has filed regulatory paperwork seeking permission to market self-indexed funds as well as funds of funds.


First Quarter Launches, Closures

U.S.-listed ETF assets reached all-time highs in the last quarter, aided by 53 new additions to the growing market; the new funds spanned a wide range of segments, but included six international equity ETFs from iShares and Deutsche Bank that offer hedged currency exposure.

At the same time, the industry bid adieu to 17 ETFs that did not quite capture investors’ imaginations or asset flows.

iShares stole the ETF graveyard spotlight last quarter, shelving 10 All Country World Index (ACWI) ex-U.S. sector funds because of weak asset gathering since the funds were launched more than three years ago. The 10 funds, which together had about $54 million in assets when the closure plan was announced in January, were brought to market on July 13, 2010.