ProShares Looks To Jump Into Active ETFs, Renaissance Plans First IPO ETF

by on June 22, 2012 | ETFs Mentioned:

Equity markets have endured a choppy week as mixed economic data releases and looming eurozone debt woes continue to plague investors’ confidence. The much anticipated FOMC announcement failed to provide the jolt to stocks many had hoped for after the Fed issued a concerning economic outlook. Amidst the flurry of trading on Wall Street, Huntingon made the jump into the ETF industry with the launch of the EcoLogical Strategy ETF (HECO). ProShares is also planning to add active ETFs to its product lineup while Renaissance, another ETF newcomer, is making strides to enter the industry with an IPO ETF [see also Three ETF Charts That Sum Up 2012].

ProShares, the largest issuer of leveraged and inverse funds, has filed for exemptive relief, which would give the issuer permission to offer actively-managed ETFs [see SEC Filing]:

  • ProShares Emerging Market Debt: The investment objective of this ETF will be to seek exposure to the emerging market debt market. The filing did not explicitly state whether the holdings would be denominated in U.S. dollars or in foreign currencies, which perhaps suggests that the firm wants to retain the flexibility to hold both. This ETF will be in direct competition with the WisdomTree Emerging Markets Local Debt Fund (ELD), which has accumulated $1.2 billion in assets under management since launching in August of 2010 [see also Monthly Dividend ETFdb Portfolio].

Research and investment management firm Renaissance Capital is making plans to enter the ETF industry [see SEC Filing]:

  • Renaissance IPO ETF: This ETF will seek to replicate the price and yield performance of the homegrown Renaissance IPO Index. The underlying index will be comprised of a revolving list of U.S. IPOs that meet certain criteria, which is changed on a two-year rotation. Renaissance currently runs the IPO Plus Aftermarket Fund, which charges 2.5% in expense fees and has accumulated over $8 million in assets under management [see also 3 ETF Types For Downside Protection].

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Disclosure: No positions at time of writing.