Coming & Going: April 2011

Published on by on April 1, 2011

March ETF Launches
Ticker ETF Assets
(In Millions)
Avg. Volume
BKLN Senior Loan Portfolio $70 62,000
ARGT FTSE Argentina 20 ETF $4 17,900
CSMB 2x Monthly Leveraged Credit Suisse Merger Arbitrage Liquid Index ETN $21 24,700
GGGG Global X Pure Gold Miners ETF $3 2,300
XOIL Global X Oil Equities ETF $4 5,700
COLX Market Vectors Colombia ETF $2 1,700
ALD Asia Local Debt Fund $153 91,238
MLPY Cushing MLP High Income Index ETN $21 118,000
TSXV S&P/TSX Venture 30 Canada ETF $5 6,400
SJB Short High Yield Fund $4 3,500
CROP IQ Global Agribusiness Small Cap ETF $19 199,000
SAGG Daily Total Bond Market Bear 1x Shares $4 5,700
TYNS Daily 7-10 Year Treasury Bear 1x Shares $4 200
TYBS Daily 20+ Year Treasury Bear 1x Shares $4 100
BUNT 3x German Bund Futures ETN $4 500
BUNL DB German Bund Futures ETN $4 300
ITLT DB 3x Italian Treasury Bond Futures ETN $4 2,200
ITLY DB Italian Treasury Bond Futures ETN $4 400
JGBT DB 3x Japanese Government Bond Futures ETN $4 500
JGBL DB Japanese Government Bond Futures ETN $4 100
IGS Short Investment Grade Corporate ETF $4 14,500
FFL Focus Morningstar Financial Services Index ETF $5 n/a
FTQ Focus Morningstar Technology Index ETF $5 n/a
FLG Focus Morningstar Large Cap Index ETF $5.1 n/a
FRL Focus Morningstar Real Estate Index ETF $5.1 n/a
FMU Focus Morningstar US Market Index ETF $5.2 n/a
FIL Focus Morningstar Industrials Index ETF $5.1 n/a
FHC Focus Morningstar Health Care Index ETF $5.1 n/a
FEG Focus Morningstar Energy Index ETF $5.1 n/a
FCD Focus Morningstar Consumer Defensive Index ETF $5.1 n/a
FCL Focus Morningstar Consumer Cyclical Index ETF $5.1 n/a
FCQ Focus Morningstar Communication Services Index ETF $5.1 n/a
FBM Focus Morningstar Basic Materials Index ETF $5.1 n/a
FOS Focus Morningstar Small Cap Index ETF $5.1 n/a
FUI Focus Morningstar Utilities Index ETF $5.1 n/a
FMM Focus Morningstar Mid Cap Index ETF $5.1 n/a
HDV High Dividend Equity Fund $5 n/a
MCHI MSCI China Index Fund $25.6 n/a

March continued the trend from the previous month, with markets being overpowered by unrest and unfortunate news overseas. The conflict in Libya escalated all month, leading the the U.S. and NATO to finally get directly involved in the situation. But the biggest headlines of the month came from the tragedy in Japan, where a 9.0 earthquake sent devastating tsunamis all across the country.

The ETF industry saw a robust surge in activity, as 38 new funds launched, with some funds catching on quickly, and others left in the dust. Notable performances this month came from Asia Local Debt Fund (ALD) which garnered $153 million in AUM with a trading volume just over 90,000 per day. What seems to be the most popular new option is the IQ Global Agribusiness Small Cap ETF (CROP) which is averaging nearly 200,000 shares traded on a daily basis.

March also saw a new competitor enter the ring with Focusshares. The company released 15 low-cost ETFs just before March came to a close. These funds are available commission-free to members of Scottrade, and rank among the least expensive ETFs on the market.

Below, we take a closer look at each of the products that debuted in March:

March ETF Launces

Senior Loan Portfolio ETF (BKLN)

  • Launch: March 3
  • Asset Class: High Yield Bond
  • Structure: ETF
  • Expense Ratio: 0.83%

This fund marks the the first ETF offering exposure to a corner of the credit market known for low sensitivity to interest rate changes. BKLN will seek to replicate the S&P/LSTA U.S. Leveraged Loan 100 Index, a benchmark designed to track the market-weighted performance of the largest institutional leveraged loans based on market weightings, spreads and interest payments. The underlying index is drawn from the larger S&P/LSTA Leveraged Loan Index, which includes more than 1,100 facilities. This fund may be a strong addition for any investor looking to mitigate the risks of interest rate changes.

FTSE Argentina 20 ETF (ARGT)

  • Launch: March 3
  • Asset Class: Latin America Equities
  • Structure: ETF
  • Expense Ratio: 0.75%

ARGT is the first pure play ETF on the Argentinian economy, furthering ETF exposure in Latin America. This fund will seek to replicate the FTSE Argentina 20 Index, a benchmark that includes the top 20 companies within the investable universe of Argentina-domiciled companies or companies that have substantial revenues or assets in Argentina. This South American economy offers the potential of big rewards, but at the price of big risks.

2x Monthly Leveraged Credit Suisse Merger Arbitrage Liquid Index ETN (CSMB)

  • Launch: March 8
  • Asset Class: Equity
  • Structure: ETN
  • Expense Ratio: 0.55%

The 2x Monthly Leveraged Credit Suisse Merger Arbitrage Liquid Index ETN (CSMB) will be linked to an index consisting of stocks that are proposed takeover targets, delivering 2x leveraged exposure on a monthly basis. Credit Suisse debuted a merger arbitrage ETN in October 2010, and CSMA has seen assets grow to about $55 million since then. CSMB will be linked to the same index underlying CSMA, but will deliver monthly returns equal to 200% of the change in the underlying index over that month. This product is meant for more sophisticated investors, as it employs a complex strategy.

Global X Pure Gold Miners ETF (GGGG)

  • Launch: March 15
  • Asset Class: Equity
  • Structure: ETF
  • Expense Ratio: 0.59%

This ETF seeks to replicate an index which tracks the performance of the largest and most liquid gold mining companies globally. Only companies that generate the vast majority of their business from gold mining are eligible to be included in the index.This fund may be a good choice for investors who want pure exposure to gold, as other funds offer exposure to companies who mine not only gold, but other metals as well.

Global X Oil Equities ETF (XOIL)

  • Launch: March 15
  • Asset Class: Equity
  • Structure: ETF
  • Expense Ratio: 0.49%

XOIL tracks the Solactive Global Oil Equities Index, which is designed to measure the performance of oil companies globally that are highly correlated with the spot price of oil, as defined by Structured Solutions AG. Component companies derive the majority of their revenues from the exploration and production of oil and/or have significant oil reserves, and the focus on companies with a high correlation to oil prices will generally avoid those involved in other industries such as natural gas or downstream operations. This fund may be a good addition for investors looking to add exposure to the spot price of oil, without worrying about the issues of contango that futures-based ETFs are subject to.

Market Vectors Colombia ETF (COLX)

  • Launch: March 16
  • Asset Class: Equity
  • Structure: ETF
  • Expense Ratio: 0.75%

This fund, from Van Eck, will seek to replicate an index which is comprised of securities of companies domiciled and primarily listed on an exchange in Colombia or that generate at least 50% of revenues in Colombia. The underlying index includes about 30 securities with market capitalizations ranging from $150 million to more than $80 billion, capturing a significant portion of the publicly-traded Colombian equity market. This will be just the second ETF to offer pure play Colombia, but because this fund offers exposure to funds that generate the majority of their revenues in Colombia, it may act as more of a pure play than the current fund on market.

Asia Local Debt Fund (ALD)

  • Launch: March 17
  • Asset Class: Equity
  • Structure: Actively Managed
  • Expense Ratio: 0.55%

ALD is an actively-managed ETF offering exposure to debt of a dozen developed and emerging Asia Pacific countries. The fund will invest primarily in local currency debt from issuers in South Korea, Indonesia, Malaysia, Singapore, Hong Kong, China, India, Thailand, Philippines, and Taiwan, as well as the developed markets of Australia and New Zealand. ALD will implement a tiered investment approach, with markets deemed to maintain larger and more liquid debt markets receiving higher weightings in the fund. A single country cap of 20% will be applied. For those investors who back the active methodology, this fund presents a strong opportunity to gain exposure to Asian debt.

Cushing MLP High Income Index ETN (MLPY)

  • Launch: March 16
  • Asset Class: MLP
  • Structure: ETN
  • Expense Ratio: 0.85%

The Cushing MLP High Income Index ETN (MLPY) will offer exposure to a criteria-weighted index tracking the performance of 30 MLPs that hold energy infrastructure and related shipping assets in North America. The effective weighting strategy results in approximately equal allocations to many of the underlying holdings; as of March 1, ten different securities made up between 4.85% and 5.16% of the related index. MLP funds offer competitive yields that may be attractive to a portfolio that is lacking in stable income.

S&P/TSX Venture 30 Canada ETF (TSXV)

  • Launch: March 17
  • Asset Class: Equity
  • Structure: ETF
  • Expense Ratio: 0.75%

TSXV will track the S&P/TSX Venture 30 Index, which is a free-float adjusted, modified capitalization-weighted index designed to provide exposure to the 30 most liquid securities of the TSX Venture Exchange. The TSX Venture Exchange is Canada. This ETF provides investors with a wide range of commodity exposure via exploration and junior mining companies listed on the TSX Venture Exchange. This fund would be a good addition a portfolio looking for exposure to Canada’s robust mining services, and the commodities that drive the prices behind these companies.

Short High Yield Fund (SJB)

  • Launch: March 21
  • Asset Class: Leveraged Bond
  • Structure: ETF
  • Expense Ratio: 0.95%

The ProShares Short High Yield (SJB) will seek to deliver daily results that correspond to -100% of the daily change in the iBoxx $ Liquid High Yield Index. That index serves as the underlying for the ultra-popular iShares iBoxx $ High Yield Corporate Bond Fund (HYG), which has more than $8 billion in assets and consists of more than 400 individual junk bonds. Because high yield bonds have been on such a strong run over the past two years, many feel that the asset class as a whole is overvalued, or even bubbled. This fund would be a great play for investors with a skeptical outlook on the high yielding bond space.

IQ Global Agribusiness Small Cap ETF (CROP)

  • Launch: March 22
  • Asset Class: Agricultural Equity
  • Structure: ETF
  • Expense Ratio: 0.75%

The Global Agribusiness Small Cap ETF (CROP) will track the IQ Global Agribusiness Small Cap Index, a benchmark that provides exposure to global small cap companies engaged in the agribusiness sector, including crop production and farming, livestock operations, agricultural supplies & logistics, agricultural machinery, agricultural chemicals, and biofuels. This ETF will hold roughly 50 securities with exposure reaching into both U.S. and international firms, making it a good play for investors looking to cash in on small agricultural companies on a global scale.

Total Bond Market Bear 1x Shares (SAGG)

  • Launch: March 23
  • Asset Class: Inverse Bond
  • Structure: ETF
  • Expense Ratio: 0.95%

This ETF seeks to deliver daily returns that correspond to -100% of the daily change in the Barclays Capital U.S. Aggregate Bond Index. The underlying index is a broad measure of investment grade fixed income securities, offering exposure to Treasuries, corporate debt, and mortgage-backed securities over a variety of maturities. SAGG is the first ETF offering inverse exposure to a broad investment grade bond index; existing products offering inverse or inverse leveraged exposure focus primarily on Treasuries.

Daily 7-10 Year Treasury Bear 1x Shares (TYNS)

  • Launch: March 23
  • Asset Class: Inverse Bond
  • Structure: ETF
  • Expense Ratio: 0.95%

This ETF seeks to deliver daily returns equal to -100% of the NYSE 7-10 Year Treasury Bond Index, a benchmark that includes intermediate term debt of the U.S. government. TYNS will be a good option for investors who have a bearish view on U.S. treasuries.

Daily 20+ Year Treasury Bear 1x Shares (TYBS)

  • Launch: March 23
  • Asset Class: Bond
  • Structure: ETF
  • Expense Ratio: 0.65%

This ETF seeks to replicate and index which is a multiple-security fixed income index that aims to track the total returns of the long-term 20 year and greater maturity range of the U.S. Treasury bond market. This fund will be a good option for investors looking for plain vanilla exposure to long-term treasuries.

3x German Bund Futures ETN (BUNT)

  • Launch: March 24
  • Asset Class: Bond
  • Structure: ETN
  • Expense Ratio: 0.95%

This fund will track a benchmark which is is intended to measure the performance of a long position in Euro-Bund Futures. The underlying assets of Euro-Bund Futures are Federal Republic Of Germany government issued debt securities (Bunds) with a remaining term to maturity of not less than 8 years and 6 months and not more than 10 years and 6 months as of the futures contract delivery date. BUNT is a great play for investors who have a bullish outlook on German debt.

DB German Bund Futures ETN (BUNL)

  • Launch: March 24
  • Asset Class: Bond
  • Structure: ETN
  • Expense Ratio: 0.50%

BUNLis the un-leveraged counterpart to BUNT.

3x Italian Treasury Bond Futures ETN (ITLT)

  • Launch: March 24
  • Asset Class: Bond
  • Structure: ETN
  • Expense Ratio: 0.95%

This ETN seeks to replicate a benchmark which is intended to measure the performance of a long position in Euro-BTP Futures. The underlying assets of Euro-BTP Futures are Republic of Italy-government issued debt securities (BTPs) with an original term of no longer than 16 years and a remaining term to maturity of not less than 8 years and 6 months and not more than 11 years of the futures contract delivery date, giving investors one of a kind exposure to Italian debts.

DB Italian Treasury Bond Futures (ITLY)

  • Launch: March 24
  • Asset Class: Bond
  • Structure: ETN
  • Expense Ratio: 0.50%

ITLY is the un-leveraged counterpart to ITLT.

3x Japanese Government Bond Futures ETN (JGBT)

  • Launch: March 24
  • Asset Class: Bond
  • Structure: ETN
  • Expense Ratio: 0.95%

This fund measures a benchmark which is intended to measure the performance of a long position in 10-year JGB Futures. The underlying assets of 10-year JGB Futures are Japan-government issued debt securities (JGBs) with a remaining term to maturity of not less than 7 years and not more than 11 years as of their issue date and the futures contract delivery date. JGBT’s leveraged exposure gives investors a new way to play various Japanese debts.

Japanese Government Bond Futures ETN (JGBL)

  • Launch: March 24
  • Asset Class: Bond
  • Structure: ETN
  • Expense Ratio: 0.50%

JGBL will serve as the un-leveraged counterpart to JGBT.

Short Investment Grade Corporate (IGS)

  • Launch: March 29
  • Asset Class: Leveraged Bond
  • Structure: ETF
  • Expense Ratio: 0.95%

This fund will short an index which measures the performance of 600 highly liquid investment grade corporate bonds, expanding the ProShares lineup of inverse bond funds to six. This fund will present a strong play for those who feel that investment grade bonds are due for a correction in the near future.

Focus Morningstar Financial Services Index ETF (FFL)

  • Launch: March 30
  • Asset Class: Equity
  • Structure: ETF
  • Expense Ratio: 0.19%

This fund marks the entrance of a new ETF issuer, Focusshares, who released an entire line of ETFs that track various Morningstar-based indexes. These funds will also present some of the cheapest expense ratios in the industry, making them an attractive bet for investors looking to lower their portfolio costs. This ETF will track the Morningstar Financial Services Index , which consists of companies that provide financial services which includes banks, savings and loans, asset management companies, credit services, investment brokerage firms, and insurance companies.

Focus Morningstar Technology Index ETF (FTQ)

  • Launch: March 30
  • Asset Class: Equity
  • Structure: ETF
  • Expense Ratio: 0.19%

This fund tracks the Morningstar Technology Index, which consists of companies engaged in the design, development, and support of computer operating systems and applications.

Focus Morningstar Large Cap Index ETF (FLG)

  • Launch: March 30
  • Asset Class: Equity
  • Structure: ETF
  • Expense Ratio: 0.05%

This fund seeks to replicate the Morningstar Large Cap Index, which measures the performance of stocks issued by large-capitalization companies that are domiciled or principally traded in the United States.

Focus Morningstar Real Estate Index ETF (FRL)

  • Launch: March 30
  • Asset Class: Real Estate
  • Structure: ETF
  • Expense Ratio: 0.12%

This fund measures an index which consists of mortgage companies, property management companies and REITs.

Focus Morningstar US Market Index ETF (FMU)

  • Launch: March 30
  • Asset Class: Equity
  • Structure: ETF
  • Expense Ratio: 0.05%

FMU tracks the Morningstar US Market Index, measures the performance of stocks issued by large-, mid-, and small-capitalization companies that are domiciled or principally traded in the US.

Focus Morningstar Industrials Index ETF (FIL)

  • Launch: March 30
  • Asset Class: Equity
  • Structure: ETF
  • Expense Ratio: 0.19%

This ETF will replicate an index which consists of companies that manufacture machinery, hand-held tools and industrial products.

Focus Morningstar Health Care Index ETF (FHC)

  • Launch: March 30
  • Asset Class: Equity
  • Structure: ETF
  • Expense Ratio: 0.19%

This ETF will replicate an index which consists of companies involved in biotechnology, pharmaceuticals, research services, home health care, hospitals, long-term care facilities, and medical equipment and supplies.

Focus Morningstar Energy Index ETF (FEG)

  • Launch: March 30
  • Asset Class: Equity
  • Structure: ETF
  • Expense Ratio: 0.19%

This ETF will replicate an index which consists of companies that produce or refine oil and gas, oil field services and equipment companies, and pipeline operators.

Focus Morningstar Consumer Defensive Index ETF (FCD)

  • Launch: March 30
  • Asset Class: Equity
  • Structure: ETF
  • Expense Ratio: 0.19%

This ETF will replicate an index which consists of companies engaged in the manufacturing of food, beverages, household and personal products, packaging, or tobacco.

Focus Morningstar Consumer Cyclical Index ETF (FCL)

  • Launch: March 30
  • Asset Class: Equity
  • Structure: ETF
  • Expense Ratio: 0.19%

This ETF will replicate an index which consists of retail stores, auto & auto parts manufacturers, companies engaged in residential construction, lodging facilities, restaurants and entertainment companies.

Focus Morningstar Communication Services Index ETF (FCQ)

  • Launch: March 30
  • Asset Class: Equity
  • Structure: ETF
  • Expense Ratio: 0.19%

This ETF will replicate an index which consists of companies that provide internet services such as access, navigation and internet related software and services.

Focus Morningstar Basic Materials Index ETF (FBM)

  • Launch: March 30
  • Asset Class: Equity
  • Structure: ETF
  • Expense Ratio: 0.19%

This ETF will replicate an index which consists of companies that manufacture chemicals, building materials and paper products.

Focus Morningstar Small Cap Index ETF (FOS)

  • Launch: March 30
  • Asset Class: Equity
  • Structure: ETF
  • Expense Ratio: 0.12%

This ETF will replicate an index which measures the performance of stocks issued by small-capitalization companies that are domiciled or principally traded in the United States.

Focus Morningstar Utilities Index ETF (FUI)

  • Launch: March 30
  • Asset Class: Equity
  • Structure: ETF
  • Expense Ratio: 0.19%

This ETF will replicate an index which consists of companies that are electric, gas, and water utilities.

Focus Morningstar Mid Cap Index ETF (FMM)

  • Launch: March 30
  • Asset Class: Equity
  • Structure: ETF
  • Expense Ratio: 0.12%

This ETF will replicate an index which measures the performance of stocks issued by middle-capitalization companies that are domiciled or principally traded in the United States.

High Dividend Equity Fund (HDV)

  • Launch: March 31
  • Asset Class: Equity
  • Structure: ETF
  • Expense Ratio: 0.40%

HDV replicates the Morningstar Dividend Yield Focus Index, which is designed to measure the performance of a select group of U.S. securities that have provided relatively high dividend yields on a consistent basis. The largest holdings of the new ETF include the usual suspects: firms such as AT&T, Chevron, Pfizer, and Verizon and from a sector perspective, the underlying index maintains its largest weightings in consumer goods (19.8%), health care (19.1%), utilities (17.1%), and telecom (16.6%). HDV aims to attract investors who realize that steady income is hard to come by from a liquid, and cost effective resource.

MSCI China Index Fund (MCHI)

  • Launch: March 31
  • Asset Class: Equity
  • Structure: ETF
  • Expense Ratio: 0.61%

This fund tracks the MSCI China Index which measures the performance of large cap Chinese equities.This is the first China ETF to be benchmarked to the large and mid cap MSCI universe. As of the most recent data, the sector breakdown for this new fund are as follows: financials (37.0%), energy (18.4%) and telecom (11.4%).

ETF Closings

No ETFs closed during the month of March.

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