Bloomberg News

Emerging-Market Industry ETF Line Opens as Traders Sharpen Focus

June 23, 2011

June 23 (Bloomberg) -- Emerging Global Advisors LLC opened eight exchange-traded funds, creating the broadest series of industry-specific emerging-market ETFs as investors seek more specialized index-based trading options.

The 10 ETFs, including two that started in 2009, buy shares across emerging-market countries and focus on industries including energy, financials, telecommunications and basic materials, the New York-based money manager said today in a statement. The funds, tracking the Dow Jones Emerging Markets Titans Index series, are listed on the NYSE Arca exchange.

Assets in U.S.-domiciled ETFs surged 15-fold to $992 billion in the decade ended Dec. 31, and the number of products expanded to 923 from 80, according to the Washington-based Investment Company Institute. Investors can use ETFs, which hold baskets of securities and trade throughout the day like stocks, to track indexes ranging from the Standard & Poor’s 500 to the Solactive Waste Management Total Return Index.

“There’s a progression toward investors using more precise tools as research is more readily available,” Robert Holderith, president of Emerging Global, said in an interview.

BlackRock Inc.’s IShares ETF lineup includes emerging- market funds tracking the financial, materials and infrastructure industries, according to the New York-based company’s website.

Among ETFs that invest in the U.S., about $148 billion, or 30 percent of assets, is dedicated to industry-specific funds, Emerging Global said. Industry ETFs capture less than $2 billion, or 1.4 percent, of emerging-market ETF assets, the company said.

The company, which is marketing the new line as Global Emerging Market Sectors, or GEMS, manages about $531 million in ETF assets, according to data compiled by Bloomberg. Its financial and energy emerging-markets ETFs, which both opened two years ago, hold about $30 million combined.

--Editors: Josh Friedman, Steven Crabill

To contact the reporter on this story: Christopher Condon in Boston at ccondon4@bloomberg.net

To contact the editor responsible for this story: Christian Baumgaertel at cbaumgaertel@bloomberg.net.


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