A recent filing from State Street Global Advisors outlines the ETF provider’s plans for a fund that will go head-to-head with the $1.6 billion iShares North American Natural Resources ETF (IGE | A-40). The SPDR S&P North American Natural Resources ETF will track the S&P BMI North American Natural Resources Index, a subindex of the S&P Global LargeMidCap Commodity and Resources Index.
That sounds remarkably similar to IGE’s underlying benchmark, the S&P North American Natural Resources Sector Index.
The SPDR fund’s underlying index will include natural resources and commodities companies falling into three buckets: energy, materials and agriculture. Each bucket’s weight will be limited to one-third of the index, while individual companies are capped at 5 percent of the index. Companies must be domiciled in the U.S. or Canada but can be listed in any developed market. They also must have a market capitalization of at least $1 billion.
Interestingly, IGE’s prospectus notes that its index components must be U.S.-listed and does not appear to have any restrictions regarding classifications.
SSgA already has the $560 million SPDR Global Natural Resources ETF (GNR | A-81), which is based on a similar index structure. Its benchmark consists of three subindexes, each capped at a weighting of one-third of the main index, covering agriculture, energy, and metals and mining, respectively. However, the proposed fund appears to be more of a subset of GNR than anything else, as GNR includes U.S. and Canadian stocks.
The filing did not include a ticker or expense ratio, but it did indicate the fund would list on the NYSE Arca.
Contact Heather Bell at [email protected].