Today saw the launch of seven ETFs on the NYSE Arca, including three funds from State Street Global Advisors that track factor-focused versions of the Russell 1000 index. Other funds launched from Direxion and via FactorShares’ exemptive relief.
3 New SPDRs
The three new funds from SSgA offer multifactor approaches to the Russell 1000 that encompass high-value, high-quality and low-size characteristics, but each one also showcases a fourth factor. The ETFs are as follows:
- SPDR Russell 1000 Momentum Focus ETF (ONEO)
- SPDR Russell 1000 Low Volatility Focus ETF (ONEV)
- SPDR Russell 1000 Yield Focus ETF (ONEY)
Russell 1000 companies are reweighted in the new indexes by their multifactor score, which comprises the value, size and quality factors as well as each fund’s fourth, unique factor. Companies that have particularly low scores/weights are excluded from the resulting new indexes.
ONEY’s underlying index included 250 components as of Sept. 30, while ONEO’s index had 894 and ONEV’s had 396. Each fund comes with an expense ratio of 0.20%.
Direxion Resurrects Funds
Direxion rolled out three new ETFs, but two are actually resurrections of funds previously offered by the firm.
The Direxion Daily S&P Biotech Bear 1X Shares (LABS) is brand new and offers inverse, or -100%, exposure to the S&P Biotechnology Select Industry Index. It comes with an expense ratio of 0.45%.
Meanwhile, the Direxion Daily Natural Gas Related Bear 3X Shares (GASX) and the Direxion Daily Healthcare Bear 3X Shares (SICK) provide -300% exposure to their respective underlying indexes, the ISE-Revere Natural Gas Index and the Health Care Select Sector Index. Both funds charge expense ratios of 0.95%.
Newcomer Highlights New Area
Finally, a new ETF brand has broken ground in terms of coverage, with the launch of the Tierra XP Latin America Real Estate ETF (LARE) via the FactorShares exemptive relief. LARE tracks an index of Latin American companies that generate the majority of their revenues from real-estate-related ventures, an area of the global markets that had yet to be specifically targeted by the ETF industry.
The fund’s underlying index covers four areas: REITs, developers, property owners/operators and companies that provide services to real estate companies and infrastructure developments. The index screens potential components for size and liquidity thresholds and weights the remaining pool of companies based on market capitalization, liquidity and dividend yield, the prospectus said.
LARE comes with an expense ratio of 0.79%.