Bonds, PIR & Low Risk – a smorgasbord of listings 

Asia

Korea

Koomkim Bank has listed a new ETF in Seoul that tracks the S&P Asia 50 Index (277540). The index is made up of stocks from Hong Kong, South Korea, Singapore and Taiwan. 277540 is not the first ETF to track this benchmark; iShares has a similar product in the US (AIA). But it is the first to do so in Asia.

Korea Investment & Securities is listing two new covered call ETNs in Seoul (570020, 570021). 570020 tracks the KOSPI Short Futures Short Put Index, meaning it will make more money if the KOSPI declines. 570021 will track the KOSPI Long Futures Short Call Index which will make money if KOSPI rises. Covered call ETFs sell options to third parties as a way of raising additional income for the fund. As 570021 and 570020 are structured as ETNs they will not by buying and writing call options; only tracking an index that acts as if it were.

China

China’s Goutai Asset Management has launched a new long-dated bond ETF, called the SSE 10-year T-bond ETF (511260). There is no English language material made available by Goutai, but the product’s name suggests it will track the 10-year Treasury bill index put together by the Shanghai Stock Exchange. According to Bloomberg, 511260 will invest “90% of net assets in constituent bonds and also invests domestic issued bonds, money market instruments and other permitted financial instruments.”

Europe

France

Amundi’s PIR tax ETF lists in Paris this week (ITALI). The PIR tax was introduced this year by the Italian government. It gives funds that stay invested in Italian SMEs a total income and capital gains tax exemption (not bad eh?). Lyxor, the first issuer to act on this, has seen huge inflows into its PIR product.

Germany

BNP Paribas will be listing a new commodities ETF into Germany and France that tracks a basket of precious and industrial metals, together with oil and gas (EMEH). The metals included are gold, silver, aluminium, copper nickel and zinc. The futures contracts will be rolled monthly.

UK

iShares will be listing its $ Floating Rate Bond ETF in two more forms next month. Floating rate bonds “float” with interest rates, meaning the coupons they pay rise and fall with central bank’s interest rates.

One will be a simple re-listing of FLOT in GBP (FLOS). As with FLOT, FLOS will track the Bloomberg Barclays US Floating Rate Note <5 Years Index.

The other listed product will be FLO5. Not much information is available about FLO5 as of yet (or at least that I can find). According to Bloomberg, it tracks the same index as FLOS and FLOT: the Bloomberg Barclays US Floating Rate Note <5 Years Index. But FLO5 a much higher expense ratio (1.00%, vs. the 0.12% of FLOS). I wonder why?

iShares will also be listing its emerging markets government debt tracker in London, which will track the J.P. Morgan Emerging Markets Bond Index (JPEE). The main governments whose bonds are tracked are: Argentina, Russia, Turkey and the Philipines, as well as a score of others. JPEE will be denominated in euros, although its index is made up of USD-denominated bonds. iShares has an ETF tracking this index already available in the US (EMB).

North America

Canada

First Asset will be launching a Canadian dollar hedged ETF into Toronto (RWX) tracking lower risk equities. RWX will physically track the MSCI EAFE Risk Weighted Top 175 Index. The index choses large and mid-cap companies from 21 developed countries – excluding the US and Canada. It then weights them by historical return variance so that lower risk stocks have greater weight.