Van Eck Cuts Indonesia ETF Price 5%

By
May 02, 2012
Share:

 

Van Eck Global, the New York fund provider known for its Market Vectors ETFs, cut the cost of its $530 million Market Vectors Indonesia Index ETF (NYSEArca: IDX)—effective immediately—by 5 percent, making the fund the cheapest in its segment.

IDX, which until April 30 cost 0.60 percent, now has a net expense ratio of 0.57 percent, undercutting its main competitor, the $278 million iShares MSCI Indonesia Investable Market ETF (NYSEArca: EIDO) by 2 basis points.

This is the second time Van Eck has cut IDX’s price. When the fund came to market three years ago, it had an annual net expense ratio of 0.71 percent, but gains in economies of scale as the fund’s assets grow have allowed for increasingly lower costs.

IDX was the first ETF to serve up focused exposure to Indonesia’s equities market when it was launched in 2009. But since then it has since been joined by iShares’ EIDO as well as by the Market Vectors Indonesia Small-Cap ETF (NYSEArca: IDXJ), launched earlier this year with a net expense ratio of 0.61 percent.

Van Eck’s original Indonesia-focused fund, which allocates nearly a third of its portfolio to financials, has delivered strong performance in its three-year history. IDX has had annualized returns in the past three years totaling 54.1 percent, according to data on Van Eck’s website. Year-to-date, IDX is up some 5 percent.

“Indonesia’s growth over the past several years has been impressive, and we believe the outlook remains bright, driven in part by rising domestic consumption and higher levels of disposable income,” Ed Lopez, marketing director at Market Vectors ETFs, said in a press release.

The new expense ratio of 0.57 percent is capped contractually until May 1, 2013, the company said on its website.

 

ETF.COM CHANNELS

Want to learn more about smart-beta ETFs? Check out our smart-beta guide, essentials library and ETF screener!

ETF DAILY DATA

International equity funds like 'IEMG' led inflows on Monday, May 18, as rising markets lifted U.S.-listed ETF assets to a record $2.174 trillion.

'SPY' and 'GLD' paced SSgA's issuer-leading outflows on Monday, May 18, as rising markets lifted total U.S.-listed ETF assets to a record $2.174 trillion.

ETF.COM ANALYST BLOGS

By Olly Ludwig

Yields will one day head higher, so is it time to get bond exposure outside the U.S.?

By Rachael Revesz

Stop dancing around the subject, call women ‘women’ and let’s be a more visible part of this industry.

By Olly Ludwig

It’s no secret that hedge funds love ETFs, but what’s less appreciated is that their love of ETFs will likely spell their demise.

By Olly Ludwig

Yes, bond yields are ticking higher these days, but it’s important to keep the whole yield-curve picture in mind.