Bigger Isn't Always Better - IndexUniverse.com

Bigger from page 10
The big funds we mentioned here have
their own advantages: They are liquid, well
established and often have liquid options
markets associated with them that allow
BKLN from page 9
without taking on too much interest-rate
risk,” said IndexUniverse ETF Analyst Gene
Koyfman, CFA. “It’s also a much more diversified
exposure across different sectors
within corporate bonds than investmentgrade,
floating-rate securities. Those are
still heavily weighted in financials.”
Updates from page 3
portfolios that include ETF baskets from
powerhouses such as iShares, State Street
Global Advisors, Vanguard, WisdomTree
and Invesco PowerShares.
The initial lineup includes:
• Global X Aluminum ETF
(NYSE Arca: ALUM)
• Global X FTSE Andean 40 ETF
(NYSE Arca: AND)
• Global X FTSE Argentina 20 ETF
(NYSE Arca: ARGT)
• Global X Copper Miners ETF
(NYSE Arca: COPX)
• Global X FTSE Colombia 20 ETF
(NYSE Arca: GXG)
• Global X SuperDividend ETF
(NYSE Arca: SDIV)
• Global X Auto ETF
(NYSE Arca: VROM)
Deutsche To Buy
Back 3 Elements ETNs
Germany-based Deutsche Bank bought
back three Elements ETNs that carry investing
legend Benjamin Graham’s name.
It didn’t cite a reason, but the three ETNs
have gathered few assets.
The three ETNs were:
• Elements Benjamin Graham Total
Market Value Index-Total Return
ETN (NYSE Arca: BVT)
• Elements Benjamin Graham Large
Cap Value Index-Total Return ETN
(NYSE Arca: BVL)
• Elements Benjamin Graham Small
Cap Value Index-Total Return ETN
(NYSE Arca: BSC)
Holders of the ETNs received a cash
payment on Aug. 26 equal to the daily repurchase
value on Aug. 23, Deutsche said
folks to execute complex trading strategies.
But it’s important for investors to
realize that the first choice isn’t always
the best choice for long-term investors,
and that they should evaluate funds by
That alone can explain why investors
have put more than $158 million into
the fund’s coffers in such a short time.
BLKN’s rapid asset accumulation has
attracted a number of copycat funds:
Both First Trust and Guggenheim have
filed paperwork with the SEC to introduce
their own senior-loan products
in a press release. The company, which already
uses Invesco PowerShares to market
a family of ETFs and ETNs it sponsors in the
U.S., also began to roll out its very own
ETFs under the DBX brand earlier this year.
iShares Launches
2 New Target-Date ETFs
iShares rolled out two additional target-date
exchange-traded funds, bringing to nine the
number of fund-of-funds ETFs that are organized
around a specific retirement date.
The two new funds, the iShares S&P
Target Date 2045 Index Fund (NYSE Arca:
TZW) and the iShares S&P Target Date 2050
Index Fund (NYSE Arca: TZY), both come
with a net annual expense ratio of 0.32 percent,
the company said on its website.
Like the rest of the target-date funds
in the iShares lineup, the new funds are
built out of different ETFs sponsored by
the San Francisco-based firm. Target-date
funds are designed so that asset allocations
shift over time away from equities to
make way for more fixed-income holdings
as the targeted retirement date nears.
New iPath ETN Debuts
Dynamic Volatility Play
Barclays Bank added to its iPath roster
of volatility-linked ETNs with the launch
of its first dynamic volatility strategy, designed
as a tool for investors to benefit
from volatility spikes while managing the
roll cost during calm markets.
The iPath S&P 500 Dynamic VIX ETN
(NYSE Arca: XVZ) is designed to give exposure
to the S&P 500 Dynamic VIX Futures TR
Index, which allocates between the S&P 500
Short-Term Futures Index Excess Return and
the S&P 500 VIX Mid-Term Futures Index
several factors, not by which is the biggest
game in town. Oftentimes you’ve
got to do some more looking under the
hood to see which fund really gives you
the exposure you’re looking for.
to the marketplace. While details are
scant, it’s likely that both products will
at least attempt to undercut BKLN’s
0.83 percent net expense ratio.
For income investors who are willing
to take on the credit risk but want to
avoid interest rate risk, BKLN is the only
game in town.
Excess Return by monitoring the steepness
of the implied volatility curve. XVZ comes
with a yearly fee of 0.95 percent.
Van Eck Debuts
Mortgage REIT ETF
Van Eck Global launched a mortgage REIT
ETF that focuses on companies involved
with the purchase or service of commercial
and residential mortgage loans.
The Market Vectors Mortgage REIT Income
ETF (NYSE Arca: MORT) will track
Van Eck’s proprietary Market Vectors Global
Mortgage REITs Index, a rules-based,
capitalization-weighted benchmark comprising
companies that derive at least 50
percent of their revenue from mortgage
REITs. Its net expense ratio is 0.40 percent.
The entire 25-stock portfolio is allocated
to REITs focused on residential and
commercial mortgages, but excludes
mortgage finance companies and saving
accounts, the company said.
Cantor Fitzgerald To
Create ETF Arb Business
New York-based capital markets investment
bank Cantor Fitzgerald is taking steps to
build its own ETF arbitrage business. The
company has enlisted Dan Segal, formerly of
SEG Capital, to head its ETF arbitrage group,
and hired a group of trader/market makers
that include Joseph La Grasta, Todd Alberico
and Kanellas Cafcules, who will focus on domestic
ETFs, international/currency ETFs and
fixed-income/commodities ETFs, respectively,
according to a press release.
The move brings Cantor Fitzgerald
closer to competing firms like Knight Capital
Group, Susquehanna, Wallach-Beth
and other ETF market makers and APs.
12 ETFR • October 2011