New semiactive ETF filed

July 05, 2005

The hegemony held by PowerShares Capital Management, the Wheaton, IL-based firm that nudged the ETF industry one step closer to actively managed with its innovative line of performance seeking Intelledexes (see cover story this issue), may about to be challenged.

The hegemony held by PowerShares Capital Management, the Wheaton, IL-based firm that nudged the ETF industry one step closer to actively managed with its innovative line of performance seeking Intelledexes (see cover story this issue), may about to be challenged.

Firsthand Capital Management Inc, a San Jose, CA-based firm that manages technology funds, filed an application with the SEC in December to create a semiactive technology ETF. And it has plans to launch more ETFs-both semi-active as well as fully active.

The proposed semiactive ETF currently before the SEC-called the Q Funds Technology Focus Portfolio ETF-will track an index of the 30 technology and communication stocks in the S&P 500 best positioned to outperform their peers with less volatility.

Firsthand Capital will use a proprietary, quantitative formula to identify stock selection and to construct the portfolio, according the SEC filing. Each selected stock would initially be equal weighted, although adjustments would be made monthly and new additions would assume the relative weightings of those exiting the portfolio. Portfolio contents would be disclosed daily.

 

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