Zacks Plans Dividend, MLP Funds And Direxion Fills Pipeline

by on June 8, 2012 | ETFs Mentioned:

Equity markets appear to have regained their footing after enduring a rather painful correction over the past few weeks. Confidence has returned to the markets thanks to growing hopes that the Fed will offer up further stimulus this month, although looming Euro zone debt drama has proven that it can resurface in a moment’s notice. Amidst the flurry of trading activity this week, Zacks and Direxion have filed plans with the SEC to launch several new ETFs [see also Jim Rogers Says: Buy Commodities Now, Or You’ll Hate Yourself Later].

Chicago-based financial research firm and mutual fund manager Zacks is planning to enter the ETF arena with a product of their own. The company is teaming up with Exchange Traded Concepts to launch a pair of ETFs targeted towards yield-hungry investors [see SEC Filing]:

  • Zacks Sustainable Dividend ETF (ZDIV): This ETF will seek to replicate the price and yield performance of the Zacks Sustainable Dividend Index and will charge 0.70% in annual expense fees. The underlying index is comprised of roughly 100 U.S. listed common stocks selected from a universe of 1,500 securities; the holdings are selected based on a quantitative rules-based methodology that assesses various factors including likelihood of a dividend payment, relative value, and company growth among others [see High Yield ETFdb Portfolio].
  • Zacks MLP ETF (ZMLP): This ETF will seek to replicate the price and yield performance of the Zacks MLP Index and will charge 0.75% in annual expense fees. The underlying index is comprised of 25 to 50 stocks selected from a universe of master limited partnerships (MLPs) listed on domestic exchanges. The filing also mentioned that this ETF will make equal allocations to each of the underlying holdings, resulting in a well-balanced MLP portfolio.

Currently, there are only three ETFs offering exposure to MLPs: the Alerian MLP ETF (AMLP) Global X MLP ETF (MLPA), and Yorkville High Income MLP ETF (YMLP).

Direxion is planning to beef up its already extensive lineup of leveraged bull/bear products [see SEC Filing]:

  • Direxion Daily Financial Bear 1X Shares: This ETF will offer inverse exposure to the Financial Select Sector Index and charge annual expense fees of 0.65%.
  • Direxion Daily Technology Bear 1X Shares: This ETF will offer inverse exposure to the Technology Select Sector Index and charge annual expense fees of 0.65%.
  • Direxion Daily Small Cap Bull 2X Shares: This ETF will offer leveraged exposure to the Russell 2000 Index and charge annual expense fees of 0.95%.
  • Direxion Daily Small Cap Bear 2X Shares: This ETF will offer inverse leveraged exposure to the Russell 2000 Index and charge annual expense fees of 0.95%.
  • Direxion Daily 20+ Year Treasury Bull 2X Shares: This ETF will offer leveraged exposure to the NYSE 20 Year Plus Treasury Bond Index and charge annual expense fees of 0.95%.
  • Direxion Daily 20+ Year Treasury Bear 2x Shares: This ETF will offer inverse leveraged exposure to the NYSE 20 Year Plus Treasury Bond Index and charge annual expense fees of 0.95%.

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Disclosure: No positions at time of writing.