iShares To List Four Bond ETFs On BATS

March 29, 2012

iShares looks right past BATS’ epic fail of an IPO, and tells the world it plans to list four more ETFs on the No. 3 U.S. exchange.

 

iShares, the world’s largest sponsor of ETFs, filed updated paperwork with the Securities and Exchange Commission saying it will launch for four additional funds on BATS, the exchange that last week suffered through a computer-caused cancelation of its initial public offering that briefly drove its share price down to pennies.

Contrary to trimming its commitment to list funds on BATS in the wake of the failed IPO, iShares is adding new ETFs to the queue of upcoming  BATS listings that it hasn’t previously announced. That suggests that BATS, the third largest U.S. exchange, is still very much in the middle of an emerging turf war between it, the Nasdaq and the New York Stock Exchange for primary listings. Indeed, iShares has upped the ante, even as BATS stripped its Chief Executive Officer Joe Ratterman of his title as chairman following the IPO embarassment.

BATS has been trying to steal market share from its rivals through a new competitive liquidity provider program and also by waiving annual listing fees for ETFs with daily trading volume of more than 2 million shares. If the free-listing offer sounds too good to be true, it’s probably because it is. Indeed, only 5 percent of U.S.-listed ETFs have average daily trading volume of more than 2 million on a rolling 60-day basis, as we pointed last month in a story titled “BATS Offers Free ETF Listings, Sort Of.”

While iShares remains the only ETF firm to have listed funds on BATS, it has already listed five funds on the Kansas City, Mo.-based exchange. San Francisco-based iShares has another eight funds in the loading dock for launch on BATS, including the four new outlined in the latest regulatory paperwork.

The iShares filings detailing the bond funds included expense ratios and tickers, indicating that the funds are nearing launch. Those ETFs, their tickers and their prices are:

  • iShares Global High Yield Corporate Bond Fund (BATS: GHYG) comes with a total net expense ratio of 0.55 percent. This fund will own own corporate bonds issued in U.S. dollars, euros, British pounds and Canadian dollar.
  • iShares Global ex USD High Yield Corporate Bond Fund (BATS: HYXU) comes with a total net expense ratio of 0.55 percent. This fund will own corporate bonds issued in euros, British pounds and Canadian dollar, with the exclusion of U.S. dollar bonds.
  • iShares Emerging Markets High Yield Bond Fund (BATS: EMHY) comes with a total net expense ratio of 0.65 percent. The new iShares Emerging Markets High Yield Bond Fund would invest in below-investment-grade dollar-denominated sovereign and corporate bonds in a mix that is rebalanced monthly.
  • iShares Morningstart Multi-Asset High Income Index Fund (BATS: IYLD) comes with a total net expense ratio of 0.60 percent including a 0.06 percent expense fee waiver through December 31, 2014. This ETF is designed to deliver consistent high income as well as long-term capital appreciation by owning a combination of stocks, bonds, real estate investment trusts and preferred shares.

As noted, iShares has already listed nine ETFs on BATS, each one focused on a single country. Those countries are Norway, Finland, Denmark, Australia, Canada, the United Kingdom, Germany and two focused on India – one a broad fund and the other targeting small-cap Indian companies.

The four bond funds will be the first fixed-income ETFs iShares is listing on BATS.

 

 

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