BusinessWeek Logo

No great ETF for plays on exchanges

Posted by: Aaron Pressman on November 29

Commenter Eli Nahass asks, after reading a recent post about the booming market for derivatives exchanges, if there are any ETFs that invest primarily in such shares. The answer is, I’m afraid, not really.

You can see which ETFs hold a big position in a stock by looking on the stock’s “components” page on Yahoo Finance. For example, the Chicago Board of Trade (Symbol: BOT) isn’t listed in the top 10 holdings of any ETF. It went public just over a year ago so maybe that’s not surprising. Cross-town rival Chicago Mercantile Exchange (CME) checks in at 5% of the iShares Dow Jones U.S. Broker-Dealers ETF (IAI) and an unspecified percentage of the streetTRACKS KBW Capital Markets ETF (KCE). ETFconnect.com, another good source of ETF info, says KCE holds almost 6% of its assets in the CME. But both of those ETFs are primarily owners of big brokerage companies like Goldman Sachs (GS) and Merrill Lynch (MER).

The New York Stock Exchange (NYX) is listed as a top 10 holding only in the First Trust IPOX-100 Index ETF (FPX), which essentially buys shares of major IPOs on the seventh day after they go public and holds them for a set period of 1,000 days. The New York Mercantile Exchange (NMX), which had its heady debut just the other day, isn’t yet a major holding in any ETF. So no holiday ETF cheer for derivatives exchanges, Eli.

TrackBack URL for this entry: http://blogs.businessweek.com/mt/mt-tb.cgi/

Reader Comments

Roger Nusbaum

November 30, 2006 11:58 AM

I think this makes a great point. Despite the roughly, ahem, 237,000 ETFs listed in the last few months there are plenty of narrow themes that either have not or cannot be isolated in ETFs.

Another one might be video game makers as a long term demographic play-think about someone who is 25 today, they are likely to be a buyer of video games for personal use when they are 50. No position in this theme yet.

Post a comment

 

About

Businessweek’s Lauren Young, Aaron Pressman, Emily Thornton, Amy Feldman, Ben Levisohn, and Ben Steverman focus on matters great and small for investors, from the views of a hot fund manager to an explanation of the latest products devised by Wall Street’s rocket scientists. Exploring trends in any area, from bonds and stocks to closed-end funds and futures, always with an eye towards giving investors a better understanding of the sometimes confusing and often chaotic world of finance. Standard & Poor’s senior index analyst Howard Silverblatt will also provide his take on companies’ finances and the markets. Voted one of the “Top 100 Finance Blogs” in 2007.

RSS Feed: Investing Insights

BW Mall - Sponsored Links