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New ETNs Named After Father of Value Investing
John Spence discusses new ETFs named after Benjamin Graham in his recent Wall Street Journal Article, “ETNs Follow Ideas of Investor Graham“.
Deutsche Bank is issuing a trio of exchange-traded notes which track indexes based on the beliefs of Benjamin Graham, the father of “value”-stock investing. According to Deutsche Bank, The ETNs seek to find businesses with “strong, liquid balance sheets that trade at a discount to the implied intrinsic value.”
The ETNs are named Benjamin Grahama Large Cap Value Elements (BVL), Benjamin Grahama Small Cap Value Elements (BSC), and Benjamin Graham Total Market Value Elements (BVT). The small-cap and total-market versions hold 100 stocks while the large-cap holds 50 stocks. All three ETNs have an expense ratio of 0.75%.
The New ETNs track the Banjamin Graham Intelligent Value Indexes. These indexes were developed by a unit of Nuveen Investments called HydePark. It should be noted that Nuveen has contracted to pay a fee to use Mr. Graham’s name.
Biotech Performs Well During Market Free Fall
While major market indexes are plunging, the BioTech HOLDRS (NYSE: BBH) fund is thriving, according to “Biotech Outperformed During Market Free Fall” by Investor’s Business Daily reporter, Trang Ho.
BBH has risen above its 50-day and 200-day moving averages while the Nasdaq, Dow, and S&P 500 are all trading below those averages.
BBH has outperformed all other biotech and health care ETFs this year. The fund has a 10% year to date return while the S&P has returned -14%. BBH is 4% below its 52-week high while the S&P has declined 19% from its high in October.
Biotech HOLDR’s closest competitor, SPDRS S&P Biotech (Amex: XBI), gained 2% year to date and 16% in the past year. XBI is only 2% below its high.
You can view Trang Ho’s full article here.
New Fund of ETFs Tracks Hedge Fund Index
Jesse Emspak discusses a new mutual fund that tracks the hedge fund market in his recent Investor’s Business Daily article, “NEW ETF Tracks Index Based on Hedge Funds”.
The IQ Alpha Hedge Strategy Fund was launched by IndexIQ, a New York firm. The fund tracks the IQ Alpha Hedge Index, which tries to replicate the returns of the following six hedge fund strategies: long/short, global macroeconomic, fixed-income arbitrage, event-driven, emerging markets, and market neutral. The weight of each strategy is rules based; the fund is not actively managed.
Since the hedge fund index went live in October, it has fallen 1.61% while the S&P 500 has declined 21%.
You can view the entire article here.
