Leveraged Sectors

February 01, 2007

ProShares expands into the sector market, with the simultaneous launch of 22 new sector ETFs.

ProShares will continue the expansion of its line-up of leveraged and inverse exchange-traded funds (ETFs) this morning, with the simultaneous launch of 22 new sector ETFs. In a twist, however, the group will only be launching two sets of funds for each index: leveraged (200 percent exposure) and inverse leveraged (-200 percent exposure). In previous launches, ProShares had also included a straight short (-100 percent exposure) version of the funds. 

It's not immediately clear if ProShares will launch the straight short funds later; the group has already filed for these funds (this story will be updated later today). Those have always been the least interesting products in the ProShares line-up, as investors can short traditional ETFs and earn the same exposure. The short funds seemed to be a legacy of ProShares' days selling traditional mutual funds, where being able to go short was a big innovation.

The new funds are tied to Dow Jones indexes, and will list on the American Stock Exchange. The names and tickers are:

Ultra Sector ProShares (200 percent exposure)
Ultra Basic Materials (UYM)
Ultra Consumer Goods (UGE)
Ultra  Consumer Services (UCC)
Ultra Financials (UYG)
Ultra Health Care (RXL)
Ultra Industrials (UXI)
Ultra Oil & Gas (DIG)
Ultra Real Estate (URE)
Ultra Semiconductors (USD)
Ultra Technology (ROM)
Ultra Utilities (UPW)

UltraShort Sector ProShares (-200 percent exposure)

UltraShort Basic Materials (SMN)

UltraShort Consumer Goods (SZK)

UltraShort Consumer Services (SCC)

UltraShort Financials (SKF)

UltraShort Health Care (RXD)

UltraShort Industrials (SIJ)

UltraShort Oil & Gas (DUG)

UltraShort Real Estate (SRS)

UltraShort Semiconductors (SSG)

UltraShort Technology (REW)
UltraShort Utilities (SDP)

The prospectus is available here.

The ProShares ETFs have been a huge hit with traders, racking up over $2 billion in assets in the first few months on the market.  The sector funds will likely be successful as well, as the sector market is popular with traders and momentum folks, who will look to the leveraged ETFs to get the most bang for their trading buck.

Last week, ProShares rolled out six ETFs offering leveraged, short and inverse leveraged exposure to the S&P 600 SmallCap and Russell 2000 Indexes.

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