Week 3 of 2014 ETP Launches

The Third week of 2014 was a fairly active week in terms of new product launches. In Europe we saw development in the Fixed Income segment, with the launch of an Actively Managed Covered Bond ETFs.

We also saw iShares Swizerland launch a CHF Investment Grade Corporate bond ETF, for the first time providing access to the Swizz Corporate Bond market.

In Canada we saw Horizon launch a couple of ETPs providing Leveraged and Inverse Leveraged exposure against the MSCI Japan Index. We also saw RBC launch some Actively Managed ETFs and a Laddered Corporate Bond ETF.

In the US we saw Market Vectos launch a High-Yield Muni ETF and PowerShares launch the Century Portfolio ETF consisting of Companies that has been in existence for at least a 100 years.

Actively Managed ETFs..

I want to vent a bit around the launch of Actively Managed ETFs. And I do it now, as it is obvious we are going to see many more of these brought to the market this year.

Typically when an Actively Managed ETF is brought to the market the Provider only provide some insight around how assets are selected.

I think the future is very bright for those Product Providers that are trying to gather assets based on a Active and Flexible mandate, provided the process is rule-based and the Manager is willing to provide adequate Transparency around not only the Selection but also the rest of the elements behind prudent portfolio management.

I don’t think a fancy theme or portfolio manager is going to be enough to lure Investors in the ETP segment. ETP Investors are typically experienced Investors that will thoughtfully design their portfolios, and not base it on luck.

At Cranberger we have now build out a structure for enhanced due diligence on these Actively Managed ETPs.

In practice this means we are contacting those providers that we fell are not providing enough insight into the whole investment process, if a Provider does not answer or is willing to provide transparency around the investments process products are flagged as essentially a Black-Box.

Please find links to the new products here: 

In Europe we say the launch of:

PIMCO Covered Bond Source UCITS ETF

http://ow.ly/swnTZ

The PIMCO Covered Bond Source UCITS ETF aims to generate the maximum income consistent with capital preservation and daily liquidity. The fund is actively managed by PIMCO and will invest primarily in a diversified portfolio of covered bonds.

The Fund will seek to achieve its investment objective by investing in an actively managed portfolio of Fixed Income Securities of which at least 80% will be invested in Covered Bonds in accordance with the policies set out below.

iShares CHF Corporate Bond ETF

http://ow.ly/sBbMR

The iShares CHF Corporate Bond ETF aims to achieve through the use of an optimised sampling approach a return on the investment which reflects the return of the Swiss Bond Index Corporate Total Return, the Fund's benchmark index as closely as possible.

The benchmark index is a sub-index of the SBI® and comprises corporate bonds issued by domestic and foreign borrowers with a fixed interest rate. To be included in the index, a bond must also exhibit an SBI® composite rating of at least BBB, a residual term of at least one year and an issue volume of at least CHF 100 million. Each bond contained in the index is weighted in accordance with its market capitalisation.

Whereas in North America the following products where launched:

 

Market Vectors Short High-Yield Municipal Index ETF

http://ow.ly/szvdH

The Market Vectors Short High-Yield Municipal Index ETF (SHYD) seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the Barclays Municipal High Yield Short Duration Index.

SHYD focus on short duration high yield munis, and tracks an index that has a 25% weighting in investment-grade triple-B bonds and 75% weighting in non-investment grade bonds. In addition, 75% of the index is in bonds issued as part of transactions of at least $100 million in size.

Horizons BetaPro MSCI Japan Bull Plus ETF

http://ow.ly/sB7AA

The Horizons BetaPro MSCI Japan Bull Plus ETF (Horizons HPU) seeks daily investment results, before fees, expenses, distributions, brokerage commissions and other transaction costs, that endeavour to correspond to two times (200%) the daily performance of the MSCI Japan Index.

The MSCI Japan Index is an equity index of securities listed on Japanese stock exchanges. Securities listed on the Tokyo, Osaka, Nagoya and JASDAQ exchanges are eligible for inclusion. It represents Japanese companies that are available to investors worldwide and provides a representation of 10 industry sectors

Horizons BetaPro MSCI Japan Bear Plus ETF

http://ow.ly/sB7Yz

The Horizons BetaPro MSCI Japan Bear Plus ETF (Horizons HPD) seeks daily investment results, before fees, expenses, distributions, brokerage commissions and other transaction costs, that endeavour to correspond to two times (200%) the inverse (opposite) of the daily performance of the MSCI Japan Index.

The MSCI Japan Index is an equity index of securities listed on Japanese stock exchanges. Securities listed on the Tokyo, Osaka, Nagoya and JASDAQ exchanges are eligible for inclusion. It represents Japanese companies that are available to investors worldwide and provides a representation of 10 industry sectors

AdvisorShares Sage Core Reserves ETF

http://ow.ly/sBvt5

The AdvisorShares Sage Core Reserves ETF (NYSE Arca: HOLD) seeks to preserve capital while maximizing income. HOLD seeks to achieve its investment objective by investing in a broad range of fixed-income securities, U.S. dollar- denominated investment grade debt securities, including mortgage- or asset-backed securities rated Baa- or higher.

The average duration of the Fund will vary on the forecast for interest rates and will normally not exceed one year. HOLD is managed by Sage Advisory Services (“Portfolio Manager”). The Sage fixed-income investment process is based upon implementing a top-down approach focused on actively managing portfolio duration risk, yield curve positioning, market segment allocation, and security selection.

PowerShares NYSE Century Portfolio ETF

http://ow.ly/sBDm0

The PowerShares NYSE Century Portfolio (Fund) is based on the NYSE Century Index. The Fund will normally invest at least 90% of its total assets in equity securities that comprise the Index.

The NYSE Century Index is designed to measure the performance of some of the largest and oldest public companies in the US. To be eligible for inclusion in the Index, a company must have been incorporated in the US for at least 100 years, have been listed on a major US exchange and have a market capitalization of at least $1 billion as of the Index’s latest rebalancing date. The Fund and the Index are rebalanced and reconstituted annually in December.

RBC Quant Canadian Dividend Leaders ETF

http://ow.ly/sBMgf

RBC Quant Canadian Dividend Leaders ETF seeks to provide unit-holders with exposure to the performance of a diversified portfolio of high-quality Canadian dividend-paying equity securities that will provide regular income and that have the potential for long-term capital growth.

RBC Quant EAFE Dividend Leaders ETF

http://ow.ly/sBZy0

The RBC Quant EAFE Dividend Leaders ETF seeks to provide unit-holders with exposure to the performance of a diversified portfolio of high-quality dividend-paying equity securities in markets in Europe, Australasia and the Far East (EAFE) that will provide regular income and that have the potential for long-term capital growth.

RBC Quant U.S. Dividend Leaders ETF

http://ow.ly/sBZj6

RBC Quant U.S. Dividend Leaders ETF seeks to provide unit-holders with exposure to the performance of a diversified portfolio of high-quality U.S. dividend-paying equity securities that will provide regular income and that have the potential for long-term capital growth.

RBC 1-5 Year Laddered Corporate Bond ETF

http://ow.ly/sBWu0

The RBC 1-5 Year Laddered Corporate Bond ETF seeks to provide unit-holders with exposure to the performance of a diversified portfolio of Canadian corporate bonds, divided (“laddered”) into five groupings with staggered maturities from one to five years, that will provide regular income while preserving capital.

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