New Claymore ETFs Almost Have It All

If you were looking for a one-stop shop to get access to the U.S. capital markets via ETFs, it's here.

Yesterday, Claymore launched a group of Capital Markets ETFs on the American Stock Exchange:

• Capital Markets Index (UEM)
• Claymore U.S. Capital Markets Bond Index (UBD)
• Claymore U.S. Micro-Term Fixed Income (ULQ)

UEM is the first ETF that covers all U.S. investment-grade capital markets. "It's probably the broadest ever launched, as far as we know, in the world," says Christian Magoon, head of the ETF group at Claymore Securities.

The fund has been 13 years in the making, primarily because the idea for it existed long before the technology to actually pull it off did. UEM's underlying index, the Capital Markets Index, represents a whopping 9,799 securities as of Dec. 31 and includes equity, fixed income and money market securities.

It's the first bond index that does intraday indicative value (IIV) every 15 seconds, capturing 500 million pieces of data on all of the constituents for index calculation.

The fund is based on the efficient markets theory that you have to own the whole market, Magoon says. "We believe it's the first time you can do it in one product."

Ordinarily, owning portions of the markets represented in this ETF would involve anywhere from two to four transactions. Now you can do it all in one shot, with a low expense ratio: .37%.

UEM doesn't hold everything under the sun - it represents 80% of all investable assets in the United States. What's left out, primarily because of tax issues, are high-yield instruments, preferreds, municipal bonds and asset-backed securities. Still, Magoon says, that 80% equals $33 trillion.

The two other ETFs in this group are subsets of UEM, and both have a .27% expense ratio: UBD consists of long-term investment-grade bonds with more than one year of maturity and ULQ is made up of one year or less investment-grade paper. "[ULQ] fits a unique niche for people looking for cash-like investments that are investment grade," says Magoon. He feels that ULQ will have the best momentum to start.

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Claymore has also released two brand new ETFs in Canada this week including :

- Claymore 1-5 Yr Laddered Government Bond ETF
- Claymore Natural Gas Commodity ETF

The Claymore Natural Gas Commodity ETF has been designed to track the performance of the benchmark NGX Canadian Natural Gas Index, less fees and expenses. The ETF will provide non-leveraged exposure to the Alberta natural gas market, by investing in physical natural gas forward contracts.

DEX 1-5 yr Laddered Government Bond Index is a Government only laddered bond index, selected from constituents of the DEX Universe Bond Index (formerly known as the Scotia Capital Bond Index). The Index is laddered into five (5) equally weighted buckets.

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