Van Eck Files For Global Chemicals ETF, Index Industry Association Is Created

by on March 16, 2012

Stock markets are continuing their bull run as encouraging economic data continues to restore confidence back in the domestic recovery. Upbeat commentary from the Fed coupled with better-than-expected retail sales earlier in the week played a key role in helping to sustain positive momentum on Wall Street. While stocks have been heating up, developments on the product development front have cooled off a bit, as the only new filing this week was for a global equity fund from Van Eck [see also How To Hedge For A Market Correction With ETFs]. 

Industry veteran, Van Eck, has laid the groundwork for an intriguing fund aimed at offering targeted exposure to the global chemicals industry [see SEC Filing]: 

  • Van Eck Global Chemicals ETF:  This ETF will seek to replicate the price and yield performance of the Market Vectors Global Chemicals Index. The underlying portfolio will consist of foreign and domestic companies involved in the chemicals industry. The component companies must generate at least 50% of their revenues from chemicals, which includes the research, development, or manufacture of chemicals or the marketing of products or services related to the industry [see Commodity Guru ETFdb Portfolio]. As of February 2012, the underlying index included 158 securities with an average market cap of $7.8 billion.
As the ETF industry continues to evolve, index providers are making big strides to promote transparency and investor education. The latest development comes in the form of a new trade body; MSCI, S&P Indices, and FTSE are uniting forces to launch a new organization intended to represent index providers. The Index Industry Association (IIA) will be an independent body which aims to educate investors on the role of indices as well as representing index users and providers [see also Tax Reform And Dividend ETFs: Cause For Concern?].  Baer Pettit, managing director and head of the MSCI index business, commented that the IIA was formed not address any specific issues, but rather to help create appropriate industry standards as well as protect intellectual property. 

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Disclosure: No positions at time of writing.