New Mortgage-Backed Securities ETF Introduced

Cleantech’s been a bit of a phenomenon in ETF-Land over recent months, so it’s nice to see that BGI Friday launched the world’s first toxic waste ETF.

Specifically, it's the iShares Lehman MBS (mortgage-backed securities) Fixed-Rate Bond Fund (MBB), based on “the performance of investment grade fixed-rate mortgage-backed pass-through securities of Ginnie Mae, Freddie Mac and Fannie Mae.”

As with all toxic waste scenarios, however, prospective shorts need to consider the substantial risk of Superfund interventions.

Barclays launches mortgage-backed securities ETF
by John Spence
MarketWatch Mar. 16 2007

UPDATE: Reports of the arrival of the iShares Lehman MBS (mortgage-backed securities) Fixed-Rate Bond Fund were, if not premature, exaggerated. On its first day, the ETF opened around 10:30am with 100 shares filled at $100.85, and closed with a second trade around 11:45 am, again of 100 shares at...$100.86. Looks like someone made a buck, before transaction costs.

Just as exaggerated and premature: that drivel from Lee Kranefuss about how “For the first time investors are able to observe intra-day pricing of a basket of mortgage securities, and have the flexibility to implement their market views blah blah blah.” I’d recommend watching the grass grow around the For Sale sign on your neighbor’s lawn as being at least as informative, and certainly more exciting.

Comments

[a.uchrinscko:]

RMAOL! Amusing comments Greg, I almost fell over when I scrolled through the last paragraph on my Blackberry! While State Street is rolling out Emerging Europe, Africa and other ETF's, (sec prospectus), iShares is screwing around with eight new domestic bond funds - none of which are world bond index funds like we want!

2007 Mar 20 06:34 AM