First Trust Advisors capped a hectic week for exchange-traded fund launches with the introduction of a pair of new funds on the American Stock Exchange this morning. The new sub-sector funds track the biotechnology and internet industries, and bring to 42 the number of ETFs launched in the last eight days.
Investors have been pouring money into the instruments, with some $15 billion flowing into the funds in the first four months of 2006. The glut of new funds joins the more than 200 ETFs already listed on U.S. exchanges.
The First Trust Amex Biotechnology Index Fund tracks Amex’s equal-weighted biotechnology index, while the First Trust Dow Jones Internet Index Fund also track an equally-weighted index, the Dow Jones Internet Index. The new funds are the sixth and seventh from First Trust, a relative newcomer to the industry whose first offering launched on the Amex in September. First Trust is set to return to the Amex on July 11 with its First Trust DB Strategic Value Index Fund, based on the Deutsche Bank CROCI US+ Index, which uses a methodology that seeks to make price-to-earnings ratios comparable across market sectors by standardizing depreciation and off-balance sheet items.
The First Trust sub-sector funds followed hot on the heels of a half-dozen new sub-sector offerings from State Street Global Advisors, which is continuing to expand its streetTRACKs and Sector SPDR lineups. The new SSgA funds cover the metals and mining, pharmaceuticals, oil and gas equipment and services, oil and gas exploration and production, retail and regional banking industries. The Amex on Wednesday also welcomed new ETF provider ProShares Advisors, which unveiled a stable of eight leveraged and inverse ETFs on several top-flight indices, including the Standard & Poor’s 500 and Nasdaq-100.
Earlier, the action was at the New York Stock Exchange, where last Friday WisdomTree Investments made its first splash a big one, launching 20 funds tracking so-called fundamentally-weighted dividend indices – 18 of the funds are weighted based on total cash dividends, with the remaining two weighted based on dividend yield. WisdomTree is banking on its Wharton School brain trust, including CEO Jonathan Steinberg, son of the investor Saul Steinberg, Chairman Michael Steinhardt, the former hedge fund manager, and Wharton finance professor Jeremy Siegel. Six of the new funds hold U.S. equities, with the remainder holding international stocks.
Also at the NYSE, on Monday Rydex Investments launched six new currency ETFs to go along with its $636 million NYSE Euro CurrencyShares. The new funds cover the Australian dollar, British pound, Canadian dollar, Mexican peso, Swedish krona and Swiss franc.