Top Portfolio Products: Market Vectors’ Indonesia ETF; Turkish Private Equity Fund Closes

High-yield bond fund from Aberdeen; fund trust from Gemini; ETRACS ETN from UBS

New products introduced over the last week include a new Indonesia small-cap ETF from Market Vectors; the closure of a Turkish private equity fund; a high-yield bond fund from Aberdeen; and a new fund trust from Gemini.

In addition, Gemini began a new fund trust and UBS launched an ETRACS ETN.

Here are the latest developments of interest to advisors:

1) Market Vectors Launches First U.S.-Listed Indonesia Small-Cap ETF

Market Vectors ETF Trust announced Wednesday the launch of Market Vectors Indonesia Small-Cap ETF (IDXJ), the first U.S.-listed ETF designed to provide investors with pure play exposure to the small capitalization segment of Indonesia’s stock market. It seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of Market Vectors Indonesia Small-Cap Index (MVIDXJTR).

IDXJ has a gross expense ratio of 0.70% and a net expense ratio of 0.61%, which is capped until at least May 1. During such time, the expense limitation is expected to continue until the fund’s board of trustees acts to discontinue all or a portion of such expense limitation.

2) O’Melveny Assists Pera Capital in Turkish Private Equity Fund

O’Melveny & Myers LLP announced that it advised Pera Capital Partners Fund I, a mid-market Turkish private equity fund, in its first closing with over 40 million euros ($52 million) in commitments from leading institutional investors, funds of funds and family offices. The fund will focus on mid-market growth capital investments and will target transactions that range between 5 million and 15 million euros ($7 million–$20 million). The fund has a target size of 120 million euros ($157 million).

The London-based team in this transaction comprised partner John Daghlian, counsel Anita Roberts, and trainee solicitor Rory McDonagh.

3) Aberdeen Launches U.S High Yield Bond Fund

Aberdeen Asset Management Inc. announced Thursday the launch of the Aberdeen U.S. High Yield Bond Fund (AUYRX). The new fund is managed by Aberdeen’s U.S. high yield team. Its objective is to maximize total return through current income and capital appreciation by investing primarily in bonds of U.S. issuers that are, at the time of investment, below investment grade. The team has managed assets in this strategy for non-U.S. investors since November 1, 2006.

In conjunction with the launch, Aberdeen published the white paper “Benefits of Long-term Allocation to U.S. High-yield Securities.”

4) Gemini Launches Northern Lights Fund Trust III

Gemini Fund Services, LLC announced Wednesday the launch of Northern Lights Fund Trust III (NLFT III), a shared mutual fund trust of independent and separately managed funds. Advisors who join NLFT III will be able to obtain economies of scale, regulatory compliance and board oversight, fund sales and operational efficiency. Membership in NLFT III will also entitle advisors to assistance with their distribution and marketing plans, as well as introductions to broker/dealers.

Trustees include James Jensen, who has served as counsel to boards of directors and managements of large and small businesses for over 40 years; Anthony Payne, a retired bank executive and executive director of the Iowa West Foundation; John Palancia, who has spent over 36 years working for financial services companies such as Merrill Lynch; Mark H. Taylor, professor of accounting at the Weatherhead School of Management at Case Western Reserve University, who has over two decades of academic experience in the auditing and accounting fields; and Jerry Vincentini, who has over 45 years of experience as a manager and leader in the school supply business.

5) UBS Launches ETRACS ETN

UBS Investment Bank announced Wednesday the launch of the ETRACS Monthly Pay 2xLeveraged Dow Jones International Real Estate ETN (RWXL), linked to the monthly compounded 2x leveraged performance of the Dow Jones Global ex-U.S. Select Real Estate Securities Index, reduced by investor fees.

RWXL offers monthly compounded 2x leveraged exposure to the Index, less fees; income potential in the form of a variable monthly coupon linked to 2 times the cash distributions, if any, on the index constituents, less any withholding taxes; global diversification resulting from 127 international real estate securities based in 22 countries; and a single USD-denominated exchange-traded security and USD-denominated income.

Read the March 18 Portfolio Products Roundup at AdvisorOne.com.

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