iShares Plans LatAm Bond Fund, First Trust Files For Futures ETF

by on May 25, 2012

This has shaped out to be another volatile week as investors continue to juggle looming uncertainties from overseas and mixed economic data releases on the home front. Amidst the flurry of trading on Wall Street, activity on the product development front has picked up after cooling off last week. ProShares rolled out the first-to-market covered bond ETF, while UBS added two leveraged dividend ETNs to its lineup. A number of product proposals also made their way to the SEC as iShares and First Trust are both planning to beef up their current list of offerings [see also 101 ETF Lessons Every Financial Advisor Should Learn].

The issuer behind the popular AlphaDEX family of products, First Trust, is planning to extend its reach into the active-management space [see SEC filing]:

  • First Trust Morningstar Diversified Futures Fund: This actively-managed ETF will be designed to achieve positive total returns that are not directly correlated to broad equity market or fixed income returns. The underlying benchmark is a fully collateralized futures index that offers diversified exposure to global markets through highly-liquid contracts in commodities, currencies, and equities. Half of the portfolio will be dedicated to commodities, while the other half will be equally split between currency and equity futures. This ETF will also utilize commodity-linked equity-linked financial derivatives to achieve its investment objective [see also Commodity Guru ETFdb Portfolio].
Industry bellwether iShares has filed for a bond ETF that will round out the firm’s lineup of internaitonal fixed income products [see SEC Filing]:
  • iShares Latin America Bond Fund: This ETF will look to replicate the price and yield performance of the Barclays Latin America Bond Index. The underlying basket of holdings consists of U.S. dollar-denominated debt securities from corporate, sovereign, and quasi-sovereign issuers. As of April 30, 2012, this ETF’s benchmark consisted of 308 issues. The portfolio will include investment grade and non-investment grade securities, although it will exclude exposure to any warrants, convertible securities, private placements, and inflation-linked bonds. From a geographic perspective, the largest allocations will go to issuers from Brazil, Mexico, Venezuela, Colombia, and Chile [see also Bond ETFs For Every Objective].

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Disclosure: No positions at time of writing.