Move over ETFs: Here come ETNs

Posted by: Lauren Young on April 21

While new issuance of exchange-traded funds (ETFs) is down this year, filings for exchange-traded notes (ETNs) are picking up. ETNs have accounted for roughly one in every two launches this year. What gives?

“Many of these ETNs are commodity and currency-focused; it’s a worrisome development in my mind,” says Jeffrey Ptak, who is director of exchange-traded securities analysis at Morningstar. “I worry we are nearing a top in commodities judging on the activity we’ve seen in the commodity space.”

Ptak describes some new ETNs here. Some recent currency additions to the ETN line up include Morgan Stanley’s Market Vectors-Chinese Renminbi/USD ETN and Market Vectors-Indian Rupee/USD ETN.

For up-to-the-minute news on ETFs and ETNs, check out Ptak’s blog, which debuted in January: Basis Pointing. His post on a new frontier ETF is especially illuminating. As he quips: “Kazakhstan Bulls, Rejoice!”

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Businessweek’s Lauren Young, Aaron Pressman, Matthew Goldstein, Emily Thornton, 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.

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