Market Vectors ETFs (Market Vectors), the exchange traded fund business of US-based investment manager Van Eck Global, has revealed it will shortly launch four new exchange traded funds (ETFs) on the Australian Securities Exchange (ASX).
The four new Australian ETFs are designed to track purpose-built pure-play indices specifically developed for Australian investors by Market Vectors Index Solutions (MVIS), the index company of Van Eck Global.
Arian Neiron, Managing Director of Market Vectors Australia, said: “I am pleased to announce that once launched, the ETFs will provide investors with targeted investment opportunities that offer a high level of transparency, liquidity and diversification.
“Our ETFs are based on purpose-built pure-play indices, designed to better capture the performance of a particular sector of the Australian economy.
“The Market Vectors Australian Banks ETF and Market Vectors Australian Emerging Resources ETF will be the first ASX-listed ETFs to offer targeted exposure to the Australian banks and small-cap energy and mining companies. The Market Vectors Australian Resources ETF and Market Vectors Australian Property ETF will offer broad diversified exposure across Australian resources and property sectors, without the biases to large-cap companies such as BHP Billiton and Westfield Group, which dominate traditional Australian market capitalisation weighted indices.
“Market Vectors is entering the Australian market place with innovative investment products that intelligently capture a desired market exposure and are priced competitively for all types of Australian investors,” said Mr Neiron.
Lars Hamich, Chief Executive Officer of Market Vectors Index Solutions (MVIS), said: “We are pleased to have licensed four of our Australian sector indices to Market Vectors Australia. We believe that the specific characteristics of our tailor-made, investable indices add value to the new Market Vectors ETFs that track them.
“Traditional indices often don’t provide a pure representation of a given market sector. We believe the unique pure-play methodology of MVIS indices provides an efficient mechanism to access true market performance,” Mr Hamich said.
“To achieve pure-play exposure, our indices include all entities that generate at least 50% of their revenue or 50% of their assets from a particular target sector of the economy. This differs from the traditional index approach where companies are just classified according to their industry,” said Mr Hamich. “MVIS conducts detailed analysis of ASX-listed securities in order to determine their sector (based on revenue) for the purposes of the indices.
“We typically impose caps on company weightings so that the ETFs based on MVIS indices offer true diversification and avoid being top-heavy. Our demanding liquidity screens and capping rules deliver a well-balanced and diversified index exposure, important features that also support ETF liquidity.
“Our commitment to the best possible transparency is enhanced through easy-to-access index data on our website (marketvectorsindices.com), a free service that enables investors to monitor the underlying index around the clock. We stand for a methodology that has been developed in response to a changing global investment landscape,” said Mr Hamich.
Market Vectors business was first launched in the US in 2006. The business now offers approximately 60 exchange traded products spanning international markets, commodities, emerging markets, global equities, fixed income and currency sectors. Market Vectors has clients worldwide and has approximately $US22 billion in assets under management, making it the seventh largest exchange traded product (ETP) family in the US and the tenth largest worldwide as of 31 August, 2013.
Details of the four new Market Vectors Australian ETFs are as follows:
