June was another interesting month for markets around the world as a number of important events transpired over the past few weeks. The Federal Reserve meeting came and went without much of a hitch as Bernanke called for the end of QE at the end of the month but suggested that the economy was still too weak to consider raising rates any time soon. While this was undoubtedly an important event, investors focused in on the eurozone and the ongoing debt crisis rocking many of the peripheral members. The focus was especially on Greece, as Athens debated on the merits of another round of austerity measures before voting them in by a slim five vote margin in the final days of June. This helped to ease investor concerns heading into the second half of the year, allowing the S&P 500 to gain back much of the losses that it experienced in the first half of the month, but nevertheless finished down just under 2.2% for the period.
The month also kept up the impressive pace that we have seen for new fund launches. More than 40 new ETFs have been launched since the start of June. This exceeds May’s 39 launches and ties April’s total, meaning that over 120 new products have hit the market in the past 90 days.
ETFs that began trading in June include:
- Guggenheim brought three new funds to market in June, starting the month off by overhauling two old active products into the Guggenheim Enhanced Core Bond ETF (GIY) and the Guggenheim Enhanced Ultra-Short Bond ETF (GSY) (formerly UBD and ULQ respectively). Later on in the month, the issuer released the ABC High Dividend ETF (ABCS) to give investors a steady income option focusing on stocks in Australia, Brazil and Canada.
- IndexIQ debuted two new products in June; The IQ Japan Mid Cap ETF (RSUN) gives investors unique exposure to Japanese equities, and the cleverly-named IQ U.S. Real Estate Small Cap ETF (ROOF) focuses on small REITs.
- Global X added to its fast-growing line of new products with two June launches. The company started its month off by rolling out the Global X Farming ETF (BARN), which will offer exposure to the global farming industry. Afterward, the issuer brought the SuperDividend ETF (SDIV) to market, marking the 35th launch from Global X.
- Deutsche Bank added five new currency hedged equity ETFs to its line of products, launching the MSCI Japan Currency-Hedged Equity Fund (DBJP), MSCI Brazil Currency-Hedged Equity Fund (DBBR), MSCI Canada Currency-Hedged Equity Fund (DBCN), MSCI EAFE Currency-Hedged Equity Fund (DBEF), and the MSCI Emerging Markets Currency Hedged Equity Fund (DBEM).
- Direxion, best known for its line of leveraged products, added another four products that focus on the triple leverage market: Daily Basic Materials Bull 3x Shares (MATL), Daily Basic Materials Bear 3x Shares (MATS), Daily Healthcare Bull 3x Shares (CURE), and Daily Healthcare Bear 3x Shares (SICK). Along with these four new ETFs, Direxion also rolled out the Direxion Total Market Bear 1x Shares (TOTS) which will seek to deliver daily returns that correspond to the inverse of the broad-based benchmark that contains more than 3,000 U.S. stocks.
- PowerShares had one of the most impressive launches this month, as it released nine RAFI style ETFs: Fundamental Pure Large Value Portfolio (PXLV), Fundamental Pure Large Core Portfolio (PXLC), Fundamental Pure Large Growth Portfolio (PXLG), Fundamental Pure Mid Value Portfolio (PXMV), Fundamental Pure Mid Core Portfolio (PXMC), Fundamental Pure Mid Growth Portfolio (PXMG), Fundamental Pure Small Value Portfolio (PXSV), Fundamental Pure Small Core Portfolio (PXSC), Fundamental Pure Small Growth Portfolio (PXSG).
- UBS brought two innovative commodity products to market this month, both of which will seek to profit from the issues of contango that so many futures-based products are subject to. The two new ETNs include the ETRACS Natural Gas Futures Contango ETN (GASZ) and ETRACS Oil Futures Contango ETN (OILZ).
- Bond giant PIMCO beefed up its ETF line up this month by releasing the PIMCO 0-5 Year High Yield Corporate Bond Index Fund (HYS), a product that will focus on fixed income in the short term, a segment that many investors are fearful could be significantly impacted by rate hikes in the near future.
- ETF leader iShares released a new fixed income fund, the Floating Rate Note Fund (FLOT), which will seek to replicate a benchmark that includes about 300 dollar-denominated, investment grade floating rate debt securities with less than five years remaining to maturity.
- AdvisorShares furthered its active ETF push with three new Madrona products: Madrona Forward Domestic ETF (FWDD), and Madrona Forward International ETF (FWDI), Madrona Forward Global Bond ETF (FWDB). Later in the month, AdvisorShares rolled out the Meidell Tactical Advantage ETF (MATH), yet another active product which will be structured as an ETF-of-ETFs.
- Emerging Global ended the month by launching several new emerging market sector funds: EGShares Composite GEMS ETF (AGEM), EGShares Basic Materials GEMS ETF (LGEM), EGShares Consumer Goods GEMS ETF (GGEM), EGShares Consumer Services GEMS ETF (VGEM), EGShares Energy GEMS ETF (OGEM), EGShares Financials GEMS ETF (FGEM), EGShares Health Care GEMS ETF (HGEM), EGShares Industrials GEMS ETF (IGEM), EGShares Technology GEMS ETF (QGEM), EGShares Telecom GEMS ETF (TGEM), and EGShares Utilities GEMS ETF (UGEM) (note that OGEM, FGEM, and AGEM are replacing EEO, EFN, and EEG, respectively, in the EGShares lineup).
- Last but not least, Morgan Stanley released the S&P 500 Crude Oil Linked ETN (BARL), a fund that will generate returns by investing in both light sweet crude, brent oil and the S&P 500.
June also saw a number of filings for new ETFs:
- PIMCO detailed plans for the PIMCO Foreign Currency Strategy Exchange-Traded Fund, which would would give investors exposure to foreign currencies through an actively-managed ETF.
- Direxion outlined plans for the launch of three non-leveraged products, a departure from its impressive line of levered and inverse ETFs. The proposed funds include Direxion Wireless Communications Shares, Direxion NASDAQ-100 Equal Weighted Index Shares (QQQE), and Direxion Nasdaq Volatility Index Shares (QVOL).
- Van Eck made a push for two funds that will offer targeted exposure to a new frontier market, Nigieria. The proposed ETF will focus on companies listed or operating in this oil-rich economy.
- First Trust plans to release the innovative ISE Cloud Computing Index Fund (SKYY) in early July.
Disclosure: No positions at time of writing.
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