ETF Watch (Nov. 21–Dec. 3): New Listings, Filings and Delistings

by: IndexUniverse


PowerShares Launches Active Real Estate ETF

Invesco PowerShares Capital Management's Active U.S. Real Estate Fund (NYSEArca: PSR) began trading November 20, offering the first "active" competition to the major REIT exchange-traded funds.

PSR selects from securities in the FTSE NAREIT Equity REITs Index, using the index’s holdings to create a more concentrated portfolio of 45­-­­55 REIT stocks. It also has the discretion to hold a significant portion of its assets in cash, if the managers determine that's needed. The fund discloses all trades at the end of each trading day.

The timing of the launch was interesting, as the real estate markets have been beaten up to a greater extent than the broad equities market this year. The beating has been partially deserved and—some real estate managers believe—partially exaggerated as a result of real estate's public profile as the cause of the worldwide market meltdown. PowerShares and other real estate managers may think that real estate is near or at a bottom and now is a good time for investment.

PSR charges an expense ratio of 0.80%.

Read the prospectus for PSR here.

RevenueShares Applies Its Methodology In ADR ETF

RevenueShares launched the RevenueShares ADR Fund ETF (NYSEArca: RTR) on November 21.

RTR tracks the RevenueShares ADR Index, another custom index designed by the ETF company to take a revenues-based slant on a major Standard & Poor's index. The rules-driven methodology reweights the constituent securities of the S&P ADR Index according to the revenue earned by the companies in that index, subject to certain tax diversification requirements.

The resulting RevenueShares ADR Index contains the same securities as the S&P ADR Index, but in different proportions.

RTR is unique in using the S&P ADR Index as its benchmark, the first ETF to do so. While there are region-specific ETFs based on ADR indexes, there is no ETF tracking the S&P ADR index. In fact, most of the competition for RTR will be from MSCI EAFE Index-pegged ETFs.

However, unlike MSCI EAFE funds, RTR extends beyond that benchmark index’s coverage to include ADRs from Canada, Mexico and South America.

RTR comes with an expense ratio of 0.60%.

The prospectus for RTR can be found here.

ProShares Rolls Out Currency, Commodity ETFs

ProShares has engaged in a two-part ETF rollout that has resulted in the fund company adding 12 inverse and leveraged commodities and currency ETFs to its extensive lineup of funds. The new products are ProShares’ first forays into commodities and currency ETFs.

Six of the funds are “Ultra” funds, offering 200% exposure to their underlying benchmarks—currencies in the case of the yen and euro funds, and the Dow Jones-AIG Commodity Index and two of its subindexes in the case of the commodities funds. The other six funds are “UltraShort” and offer -200% exposure to those same benchmarks.

As is the case with the pre-existing ProShares ETFs, each of the new funds charges an expense ratio of 0.95%.

The first batch of funds was launched November 25 and included the following ETFs:

  • ProShares Ultra DJ-AIG Commodity (NYSE Arca: UCD)
  • ProShares UltraShort DJ-AIG Commodity (NYSEArca: CMD)
  • ProShares Ultra DJ-AIG Crude Oil (NYSEArca: UCO)
  • ProShares UltraShort DJ-AIG Crude Oil (NYSEArca: SCO)
  • ProShares Ultra Euro (NYSEArca: ULE)
  • ProShares UltraShort Euro (NYSEArca: EUO)
  • ProShares Ultra Yen (NYSEArca: YCL)
  • ProShares UltraShort Yen (NYSEArca: YCS)

The second batch was launched December 4:

  • ProShares Ultra Gold (NYSEArca: UGL)
  • ProShares UltraShort Gold (NYSEArca: GLL)
  • ProShares Ultra Silver (NYSEArca: AGQ)
  • ProShares UltraShort Silver (NYSEArca: ZSL)

The prospectus for all 12 of the ETFs can be found here.


Van Eck Files For Country-Specific Middle East ETFs

ETF provider Van Eck Global has filed with the SEC to launch two funds tracking Kuwait and Egypt. The firm already has an ETF in its Market Vectors family that covers the countries of the Gulf Cooperation Council (including Kuwait, but not Egypt).

The Middle East has been a popular area lately, with three ETFs launching in 2008 that cover the area. However, the Van Eck filings, should they come to market relatively soon, will likely be the first ETFs to cover those two markets exclusively. There is no mention in the prospectus of what the underlying indexes will be or what the expense ratios are projected to be.

You can find the prospectus for the two funds here.

EGA Makes First Filings

A new would-be ETF provider recently made its first filing: EGA Emerging Global Shares Trust has submitted papers to the SEC for 10 emerging market sector ETFs and one broad-based emerging markets fund.

The ETFs will all track Emerging Market Titans indexes and subindexes from Dow Jones. Each of the 10 sector funds will hold the top 30 emerging market companies in the relevant sector. The sectors are: Basic Materials, Basic Resources, Consumer Goods, Consumer Services, Financials, Health Care, Industrials, Technology, Telecomunications and Utilities. The broad-based fund will track the Emerging Global Shares Dow Jones Emerging Markets Titans Composite Index Fund, holding 300 emerging market companies.

While the number of emerging markets ETFs is growing rapidly, this filing could turn out to be the first comprehensive family of emerging markets sector funds.

The expense ratio for the new ETFs is projected to be 0.85%, and the shares are set to be listed on the NYSE Arca exchange.

View the prospectus here.


HealthShares Liquidates All Funds

XShares has liquidated all 19 of its ETFs, and is scheduled to dissolve the HealthShares fund management company on Dec. 31. Market conditions, the inability of the ETFs to attract significant market interest since inception, and lack of prospects for future growth and economic viability played into the decision by the funds’ board and investment advisor, XShares Advisors.

The liquidation actually came in two phases. XShares first tried to reinvigorate the HealthShares lineup by shutting down 15 of the funds and remaking the remaining four into broader portfolios. But those changes failed to reignite interest, and the company shut down all of the funds. The last day of trading is scheduled for Dec. 23.

This is the second major liquidation for XShares. The company earlier closed its lineup of real estate funds, which were marketed as AdelanteShares. In a statement, however, XShares said it remains committed to bringing out new ETFs in 2009 related to the environment and infrastructure.

Ziegler Shutters ETF

The $3.6 million NYSE Arca Tech 100 ETF (NYSE: NXT) is set to stop trading on Dec. 15, with distributions to shareholders scheduled for Dec. 26. Together with the HealthShares liquidation, this should push the total number of ETFs liquidated in 2008 to 46.

NXT was launched in March 2007 as an alternative to the popular PowerShares NASDAQ-100 ETF (NasdaqGM: QQQQ). Many consider QQQQ a proxy for the Technology sector, but in reality, it holds a mix of Tech and non-Tech stocks. NXT, in contrast, holds 100 pure Technology stocks and offered a unique pure-play on the Technology sector. Apparently not unique enough, however.

NXT was the only ETF offered by Ziegler Capital. The company will now turn its attention back to its mainline business, where it manages approximately $3.1 billion in fixed-income and equity assets, including $700 million in mutual fund investments, through its fund family, North Track Funds.

Fund Ticker Exchange ER (%) Asset Class Launch Date
PowerShares Active U.S. Real Estate Fund PSR NYSE Arca 0.80 Real Estate - Domestic 11/20/2008
RevenueShares ADR ETF RTR NYSE Arca 0.60 International - Developed 11/21/2008
ProShares Ultra DJ-AIG Commodity UCD NYSE Arca 0.95 Commodities 11/24/2008
ProShares UltraShort DJ-AIG Commodity CMD NYSE Arca 0.95 Commodities 11/24/2008
ProShares Ultra DJ-AIG Crude Oil UCO NYSE Arca 0.95 Commodities 11/24/2008
ProShares UltraShort DJ-AIG Crude Oil SCO NYSE Arca 0.95 Commodities 11/24/2008
ProShares Ultra Euro ULE NYSE Arca 0.95 Currency 11/24/2008
ProShares UltraShort Euro EUO NYSE Arca 0.95 Currency 11/24/2008
ProShares Ultra Yen YCL NYSE Arca 0.95 Currency 11/24/2008
ProShares UltraShort Yen YCS NYSE Arca 0.95 Currency 11/24/2008
ProShares Ultra Gold UGL NYSE Arca 0.95 Commodities - Precious Metals 12/4/2008
ProShares UltraShort Gold GLL NYSE Arca 0.95 Commodities - Precious Metals 12/4/2008
ProShares Ultra Silver AGQ NYSE Arca 0.95 Commodities - Precious Metals 12/4/2008
ProShares UltraShort Silver ZSL NYSE Arca 0.95 Commodities - Precious Metals 12/4/2008
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