The first ETFs of ETFs from PowerShares and other launches, plus weekly data and our list of ETFs in registration.
- Page 1: New Listings
- Page 2: ETF Data Watch
- Page 3: The complete list of ETFs (and ETNs) in registration
Note: Want to receive an email notice as soon as ETF Watch is posted? Just click here to subscribe.
PowerShares Launches First ETFs Of ETFs
On May 20, PowerShares once again broke new ground in the exchange-traded fund industry with the launch of the first ETFs of ETFs, the PowerShares Autonomic Global Asset Portfolios. The three funds were launched Tuesday on the American Stock Exchange and track indexes of ETFs designed by Boston-based advisory firm New Frontier Advisors (NFA).
The PowerShares Autonomic Growth NFA Global Asset Portfolio (AMEX: PTO), PowerShares Autonomic Balanced Growth NFA Global Asset Portfolio (AMEX: PAO) and PowerShares Autonomic Balanced NFA Global Asset Portfolio (AMEX: PCA) represent three different asset allocation strategies and risk levels, with differing amounts assigned to several different asset classes. The equity allocation encompasses domestic stocks, foreign stocks and real estate, while the fixed-income bucket covers fixed income, commodities and currency.
NFA uses its proprietary "Resampled Efficiency" optimization processes to construct an index of ETFs that will deliver maximum returns for a desired risk level.
PCA's assets are approximately 60% equity and 40% fixed income. PAO is 75% equity and 25% fixed income. PTO, the most growth-oriented of the three new ETFs, is 90% equity and just 10% fixed income. Each ETF has 27 holdings, and not surprisingly, many of those are other PowerShares ETFs. The underlying indexes are rebalanced on a quarterly schedule but can be rebalanced more often if market conditions cause the indexes to deviate from their targeted risk levels.
All three funds charge an expense ratio of 0.25% on top of the fees assessed by the underlying ETFs.
Read the prospectus for the PowerShares Autonomic Global Asset Portfolios here.
WisdomTree Adds Two More Currency ETFs
This week WisdomTree added two more funds to its growing lineup of actively managed currency ETFs. The currency funds are a bit of a departure for the firm, which usually features earnings- or dividend-weighted index ETFs.
The WisdomTree U.S. Current Income Fund (NYSE Arca: USY) is the first actual money market ETF to hit the U.S. market. The fund is currently allocated 43.49% to government bonds and 56.51% to commercial paper. USY has an average yield to maturity of 2.23%. It charges an expense ratio of 0.25%.
The WisdomTree Dreyfus Japanese Yen fund (NYSE Arca: JYF) invests in short-term, investment-grade debt from Japan. It is designed to function essentially as a money market fund offering exposure to the Japanese market. The Japanese fund charges 0.35% in annual expenses.
Read the prospectus for WisdomTree’s currency ETFs here.
A Small Slice Of Emerging Markets
State Street Global Advisors rolled out the U.S. market's first capitalization-weighted, small-cap emerging markets exchange-traded fund on May 16. The SPDR S&P Emerging Markets Small Cap ETF (AMEX: EWX) tracks the S&P/Citigroup Emerging Market Small Cap Index.
WisdomTree manages the WisdomTree Emerging Markets SmallCap Dividend Fund (NYSE Arca: DGS), but it is dividend-weighted.
The new SPDR fund's underlying index had roughly 1,660 holdings as of March 31. Taiwan has by far the largest weighting among the 25 countries represented at 31.91%, while China is weighted at 7.83%, India at 6.51%, South Africa at 6.48% and Brazil at 5.97%.
EWX charges an expense ratio of 0.65%.
Read EWX’s prospectus here.
On May 19, Northern Trust launched three ETFs covering Belgium, the Netherlands and China on the NYSE Arca platform:
* NETS Hang Seng China Enterprises Index Fund (NYSE Arca: SNO)
* NETS BEL 20® Index Fund (NYSE Arca: BRU)
* NETS AEX-Index Fund (NYSE Arca: AEX)
SNO’s underlying index covers the "H" shares - which are basically shares in companies based in mainland China that have listed on the Hong Kong Stock Exchange. With China's stock markets largely closed to foreign investment, the H-shares are one of the few ways that foreign investors can gain direct access to China's red-hot economy. SNO charges an expense ratio of 0.51%.
The NETS BEL 20® Index Fund (NYSE Arca: BRU) tracks Belgium's blue-chip index of the 20 largest stocks listed on the Euronext Brussels exchange, while the NETS AEX-Index Fund (NYSE Arca: AEX) covers Amsterdam's top 25 blue-chip stocks. Both carry an expense ratio of 0.47%.
Read the prospectus for the new NETS here.
SSgA Files For New International And Fixed Income ETFs
SSgA has filed for four new fixed income ETFs and four new international ETFs.
The international funds cover one country, Ireland, and three emerging market regions: Southeast Asia, Africa and the Gulf Cooperation Council markets. Ireland is a bit of a surprise as the SPDR family generally takes a regional approach to international investing and does not usually cover individual countries outside of the U.S. There are a few exceptions, such as Japan and China, but Ireland seems a strange choice. The filing raises the possibility that SSgA may be expanding into territory previously only covered by MSCI (and now the Northern Trust NETS). The underlying index will be S&P/Citigroup Capped Ireland Index.
The SPDR S&P Emerging Markets South East Asia ETF will track the S&P Southeast Asia 40 Index, which covers Indonesia, Malaysia, the Philippines and Thailand. Meanwhile, the SPDR S&P Emerging GCC-Middle East ETF will track the S&P GCC 40 Index, which covers Bahrain, Kuwait, Oman, Qatar and the United Arab Emirates. The SPDR S&P Emerging Africa ETF will track the S&P Africa 40 Index, which covers Congo, Egypt, Ghana, Mali, Morocco, Nigeria, South Africa and Zambia. The SPDR family already includes the SPDR S&P Emerging Middle East & Africa ETF (AMEX: GAF), but it is heavily weighted toward South Africa and Israel.
The fixed income ETFs all track indexes from Lehman Brothers and cover mortgage-backed securities, U.S. convertible bonds, and long-term and intermediate-term bonds. They include the SPDR Lehman Mortgage Backed Bond ETF, the SPDR Lehman Intermediate Term Credit Bond ETF, the SPDR Lehman Long Term Credit Bond ETF and the SPDR Lehman Convertible Bond ETF. Interestingly, iShares already offers ETFs linked to the Lehman Brothers MBS and intermediate-term credit bond indexes.
Read the prospectus for the international ETFs here.
Read the prospectus for the fixed income ETFs here.
|Fund||Symbol||Exchange||Expense Ratio||Listing Date||Category|
|SPDR S&P Emerging Markets Small Cap ETF||EWX||AMEX||0.65%||5/16/2008||International - Emerging|
|NETS Hang Seng China Enterprises Index Fund||SNO||NYSE Arca||0.51%||5/19/2008||International - Emerging - Country|
|NETS BEL 20 Index Fund||BRU||NYSE Arca||0.47%||5/19/2008||International - Developed - Country|
|NETS AEX-Index Fund||AEX||NYSE Arca||0.47%||5/19/2008||International - Developed - Country|
|PowerShares Autonomic Growth NFA Global Asset Portfolio||PTO||AMEX||0.25%||5/20/2008||Multi-Asset Class|
|PowerShares Autonomic Balanced Growth NFA Global Asset Portfolio||PAO||AMEX||0.25%||5/20/2008||Multi-Asset Class|
|PowerShares Autonomic Balanced NFA Global Asset Portfolio||PCA||AMEX||0.25%||5/20/2008||Multi-Asset Class|
|WisdomTree U.S. Current Income Fund||USY||NYSE Arca||0.25%||5/20/2008||Currency|
|WisdomTree Dreyfus Japanese Yen fund||JYF||NYSE Arca||0.35%||5/21/2008||Currency|
Two great funds duke it out on fees, but holding costs tell a different story.
By including factor tilts in smart beta’s definition, you get a mishmash of ETFs.
When ETF-friendly advisors give advice to prospects, it’s worth noting what they shouldn’t say.
UAE and Qatar leaving iShares frontier ETF ‘FM’ poses problems, but will make the fund better.