Van Eck Amends Filing For Junior Miners ETF

September 14, 2009

Van Eck Global has filed an amendment to its original filing, continuing the process to launch the market's first small- and mid-cap mining exchange-traded fund. 


Van Eck Global has filed an amendment to its original June filing seeking to launch a new gold exchange-traded fund, the Market Vectors Junior Gold Miners ETF.

The fund would track the Market Vectors Junior Gold Miners Index, covering stocks and depositary receipts of U.S. and foreign companies that are involved in the gold and silver mining industries. (You can read the original story here.)

As of late August, the Junior Gold Miners Index consisted of companies with a market capitalization of anywhere from $190 million to $1.25 billion, with an average capitalization of $560 million.

Right now, no ETF targets solely small- and mid-cap mining stocks. But the proposed new Van Eck fund would join the very successful Market Vectors Gold Miners ETF (NYSEArca: GDX), which captures the large-cap segment of the gold mining market and has nearly $4.5 billion in assets under management. (It follows the Market Vectors Gold Miners Index.)

Certainly there are plenty of gold bullion-holding ETFs already on the market. The most popular is the SPDR Gold Shares (NYSEArca: GLD). Last week, a third gold-bullion bearing ETF appeared from European funds giant ETFS, which is just starting to expand into the U.S. (See story here.)

Besides already running GDX, Van Eck Global manages the Van Eck International Gold Fund (INIVX). The mutual fund also invests in common stocks of gold-mining companies. It has net assets estimated at $708.5 million and an average market capitalization of $3.9 billion.

The proposed ETF following the index of  "junior" components would list on the New York Stock Exchange. No ticker was mentioned in the latest filing.

According to the prospectus filed with the Securities and Exchange Commission for the new ETF, it would invest at least 80% of its total assets in securities that comprise its benchmark index.  It may invest its remaining assets in money market instruments.

The ETF will hold various combinations of the securities in the index in proportion to their weightings. Additional derivative instruments might also be used.

Van Eck decline to comment on the latest filing. You can find it here.

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