Over the past year, Japanese stocks have lagged most countries in the Pan-Asia basin. But that hasn’t stopped State Street Global Advisors (SSgA) from launching a fresh round of two new Japanese ETFs to add to the company’s growing roster of international funds.
As its name implies, the first of the two new funds, the streetTRACKS Russell/Nomura Prime Japan ETF (Amex: JPP) shadows an index created by the Russell Investment Group and Nomura Securities. This benchmark measures the performance of Japan’s 1,000 largest stocks; the ETF’s goal is to provide exposure to the broad Japanese stock market. According to the prospectus, the fund carries an expense ratio of 0.50 percent.
The other fund, the streetTRACKS Russell/Nomura Small Cap Japan ETF (Amex: JSC), also tracks an index created by Russell and Nomura, this one containing the smallest 15 percent of companies traded in the Japanese stock market. It has a slightly higher expense ratio of 0.55 percent to reflect the added hurdles that trading in smaller stocks can entail.
“These new ETFs add to our collection of international funds and enable investors to better access the Japanese market, a global economic powerhouse second in size only to the U.S. market,” explains James Ross, senior managing director of State Street Global Advisors. “This launch is just a first step for SSgA. In the near future, we plan to introduce additional international ETFs that will provide cutting-edge, geography-specific and industry-targeted exposure.”
Boston-based SSgA manages a total of 66 ETFs representing approximately $110 billion in AUM as of October 31st, 2006.
Ron DeLegge is editor of www.etfguide.com.