Daily ETF Watch: 3 Funds Launch

December 17, 2014

A total of three ETFs are launching today, two index strategies focused on the hot biotech sector, and a third, an active fund, targeting what the managers deem to be undervalued stocks outside of the U.S.  In sum, the three new securities bring to 196 the number of funds that have launched this year.

The three ETFs and their annual expense ratios are as follows:

BioShares Biotechnology Products Fund, which has a primary listing on Nasdaq under the symbol “BBP.” It has an annual expense ratio of 85 basis points, or $85 for each $10,000 invested.

BioShares Biotechnology Clinical Trials Fund, which has a primary listing on Nasdaq under the symbol “BBC.” It, too, has an annual expense ratio of 85 basis points.

ValueShares International Quantitative Value ETF, which has a primary listing on the BATS exchange, and has an annual expense ratio of 99 basis points.

As noted, 196 new ETFs have been launched so far in 2014, compared with 162 launches in all of 2013, according to data compiled by ETF.com. The pace of closures this year meanwhile looks similar to a year ago, with 68 strategies shuttered so far, compared with 69 closures last year.

Total assets in more than 1,660 ETFs are now nearly $1.908 trillion. Assets keep flowing into ETFs, fund launches continue apace and markets have mostly been pushing upward into record territory almost six years after the subprime mortgage crisis cratered markets and brought the global economy to the brink of a full-scale meltdown.

A Proposed Jetsons ETF

iShares, the world’s biggest ETF company, this week put into registration an equity ETF that will hold companies with cutting-edge technologies that have the potential to disrupt and topple existing industries in the global economy.

The iShares Exponential Technologies ETF is based on research by Morningstar Inc., which, as of Sept. 30, identified nine exponential technology themes: big data and analytics, nanotechnology, medicine and neuroscience, networks and computer systems, energy and environmental systems, robotics, 3-D printing, bioinformatics, and financial services innovation.

Investors are clearly showing interest in such longer-term “deep alpha” plays. In fact, it’s as if iShares has combined niche themes already available in a few newer funds and combined them in one security. Among those existing strategies are the $101 million Robo-Stox Global Robotics and Automation ETF (ROBO | F-20) and the $58 million PureFunds ISE Cyber Security ETF (HACK).

The filing said that the “exponential technology” themes are reviewed on an annual basis and may change over time.

The San Francisco-based ETF company didn’t say in the preliminary paperwork how much the iShares Exponential Technologies ETF would cost, under what ticker it would trade or on what exchange it would have its primary listing.

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