A ProShares Vet's New Company Unveils its First ETFs
News summary by MFWire's editors
Emerging Global Advisors, a company started by a Proshares vet, has launched its first ETFs. Robert Holderith, formerly the managing director of institutional sales and investment analytics at ProShares, started Emerging Global Advisors in 2008.
On Friday, the company launched the EGS Emerging Markets Energy Fund and the EGS Emerging Markets Metals & Mining Fund. EGA plans to introduce a total of 10 sector-based emerging markets ETFs
Company Press Release
NEW YORK--(BUSINESS WIRE)--The first-ever emerging market sector family of Exchange-Traded Funds (ETFs) has been introduced by Emerging Global Advisors, LLC, (EGA) it was announced today.
The new Emerging Global Shares (EGS) family of ETFs is based on the Dow Jones Emerging Markets Sector Titans Indexes and is designed to provide institutional investors with broad-based exposure to leading emerging market companies across multiple industry sectors. The initial funds will focus on Energy and Metals & Mining. All the ETFs will be listed on the NYSE Arca electronic exchange.
“For the first time, institutional investors will have a transparent vehicle for gaining sector-based exposure to the emerging markets,” said Robert Holderith, chief executive officer at Emerging Global Advisors. “Our family of ETFs will provide the market access and liquidity to allow institutions to execute trading and investment strategies that have not been previously possible.”
The initial group of ETFs begins trading today, and will include the following:
* The EGS Emerging Markets Energy Fund seeks to track, before fees and expenses, the performance of the Dow Jones Emerging Markets Oil & Gas Titans 30 Index, and will trade under the symbol (NYSE Arca: EEO). The Dow Jones Index includes 30 of the largest emerging markets companies in the oil & gas industry across 13 countries.
* The EGS Emerging Markets Metals & Mining Fund is designed to track, before fees and expenses, the performance of the Dow Jones Emerging Markets Metals & Mining Titans 30 Index, and will trade under the symbol (NYSE Arca: EMT). The Dow Jones Index includes 30 of the largest emerging market companies in the metals and mining sectors across nine countries.
Each ETF has exposure to a diversified mix of countries reducing single-country economic and political risk, an important concern for many emerging markets investors. Components of the underlying indexes have been selected by Dow Jones Indexes based on float-adjusted market capitalization, revenue, and net profits.
Launched by industry veterans
Emerging Global Advisors is a thematic research and asset management firm founded by ETF industry veteran Holderith in 2008 to develop and market the EGS family of ETFs. Prior to starting EGA, Holderith was Managing Director, Institutional Sales and Investment Analytics, at ProShare Advisors. Before that, he was a Director at UBS Wealth Management Group in New York City, where he developed ETF models for retail and institutional advisors.
The management team also includes Richard Kang, who serves as chief investment officer (CIO) and director of research at EGA. Kang has held a number of senior level positions in the financial services industry, including roles as CIO and portfolio manager at various firms primarily involved in the active use of indexed products. He has substantial experience with ETFs and derivative-based products as well, and writes and speaks broadly on the use of ETFs in portfolio management and optimization. EGA plans to leverage Kang’s considerable expertise in working closely with institutional clients to research and implement strategies for utilizing the emerging markets ETFs in portfolios.
“The Emerging Global Shares ETFs are designed to give investors the ability to execute active investment management strategies in markets where the liquidity to trade is not always available,” said Kang. Kang noted that capital markets in some developing countries have experienced periods of illiquidity and have been closed on occasion. Because they are listed in the U.S., the Emerging Global Shares ETFs will not be directly affected by such closings and will continue to trade during periods of illiquidity in foreign markets. In addition, the ETFs may be borrowed and shorted, a practice sometimes prohibited on emerging markets exchanges.
EGA plans to introduce a total of 10 sector-based emerging markets ETFs based on the modified market cap Dow Jones indexes, as well as products built on a Basic Resources index, and additional composites of multiple indexes.
“Current ETF offerings generally limit investors to country or regional exposure, or require a more general investment in emerging markets,” said Holderith. “We think there will be considerable interest in a family of products that provides diversified emerging market sector exposure in a highly transparent, highly liquid ETF format.”
About Emerging Global Advisors LLC
Emerging Global Advisors LLC is an independent investment advisory firm and the sponsor of the Emerging Global Shares family of Exchange-Traded Funds. The firm’s thematic research focuses primarily on investor opportunities in the emerging markets. More information on the firm and its ETF products can be found at www.egshares.com. The Emerging Global Shares Funds are distributed by ALPS Distributors, Inc. Robert Holderith is a registered representative of ALPS Distributors, Inc.
Carefully consider the Fund’s investment objectives, risk factors and charges and expenses before investing. This and other information can be found in the Funds' prospectuses, which may be obtained by calling 1-888-800-4EGA (4347) or by visiting the fund’s website www.egshares.com to view or download a prospectus. Read the prospectus carefully before investing. Investing involves risk, including possible loss of principal.
ETFs are subject to risk similar to those of stocks including those regarding short-selling and margin account maintenance.
These funds will concentrate their investments in issuers of one or more particular industries to the same extent that their Underlying Index is so concentrated and to the extent permitted by applicable regulatory guidance. Concentration risk results from maintaining exposure to issuers conducting business in a specific industry. There is a risk that those issuers (or industry sectors) will perform poorly and negatively impact a Fund. The risk of concentrating investments in a limited number of issuers in a particular industry is that a Fund will be more susceptible to the risks associated with that industry than a fund that does not concentrate its investments.
In addition to the normal risks associated with investing, emerging market investments may involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles, from economic or political instability in other nations or increased volatility and lower trading volume.
The ETFs are new and have no operating or performance history. They are not suitable for all investors.
"Dow Jones," and “Dow Jones Emerging Sector Titans Indexes™," are service marks of Dow Jones & Company, Inc. and have been licensed for use for certain purposes by Emerging Global Advisors. EGA’s ETFs based on the Dow Jones Emerging Sector Titans Indexes are not sponsored, endorsed, sold or promoted by Dow Jones, and Dow Jones makes no representation regarding the advisability of trading in such product(s).