Daily ETF Watch: 4 Funds Launch Tuesday

A quartet of exchange-traded products are launching on Tuesday, July 29, including three leveraged funds from Direxion and an ETN backed by the Royal Bank of Canada that will target master limited partnerships.

The Direxion launch will include a pair of long, double-exposure ETFs focused on small-cap and midcap stocks, as well as a long double-exposure fixed-income ETF targeting the 7- to 10-year portion of the U.S. Treasurys yield curve.

The rollouts come as the stock market continues to push to new highs, and when investors are braced for higher borrowing rates ahead. Still, investors are nonetheless accustomed to the slow pace of recovery since the market collapsed and the Fed cut rates to zero in September 2008.

Tuesday’s launches will bring the year-to-date ETF rollout total to 114 new products compared with 79 new funds for the same period last year. There are currently 1,618 ETFs managing $1.876 trillion in assets.

Direxion Launches

Direxion’s latest launches include the:

• Direxion Daily Mid Cap Bull 2X Shares (MDLL), 0.66 percent, or $66 for every $10,000 invested
• Direxion Daily Small Cap Bull 2X Shares (SMLL), 0.66 percent
• Direxion Daily 7-10 Year Treasury Bull 2X Shares (SYTL), 0.65 percent

Direxion’s new funds were made public via en electronic NYSE communique.

ETN Launch

Also, the Royal Bank of Canada is launching the RBC Yorkville MLP ETN (YGRO), joining behemoths in the space, including the $5.6 billion JPMorgan Alerian MLP ETN (AMJ) and ALPS’ $9 billion Alerian MLP ETF (AMLP).

The RBC hopes YGRO wins some of the investor appetite for income-generating strategies, including MLPs at a time of ultra-low interest rates. MLPs are well known for the steady dividends they deliver, and their popularity is clear in the assets AMLP and AMJ have gathered.

YGRO’s annual investor fee is equal to 0.90 percent, or $90 for every $10,000 invested.