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June 06, 2011 at 06:45 AM
New products introduced over the last week include a new emerging-markets fund from T. Rowe Price, two new funds focused on Asia, one each from Matthews and IndexIQ, and a new agricultural fund from Global X.
In addition, Putnam was named subadvisor to two Mackenzie Investments funds, Nuance began its first fund, and Tortoise Capital added an open-end fund; New York Life began a guaranteed interest pension fund; and Cadaret, Grant and Smartleaf each launched new portfolio management tools.
Here are the 10 latest developments of interest to advisors:
1) T. Rowe Price Expands Emerging Markets Bond Fund Lineup
T. Rowe Price announced on Thursday that it has launched an emerging markets bond fund invested in local currency bonds. The T. Rowe Price Emerging Markets Local Currency Bond Fund (PRELX) seeks to provide high income and capital appreciation and allows investors to diversify away from the U.S. dollar.
The fund, which takes a high-risk approach to income from foreign bonds, will be managed by Chris Rothery and Andrew Keirle with a net expense ratio estimated to be 1.10% for investor-class shares and 1.20% for advisor-class shares.
The fund will be primarily driven by currency performance, as well as local interest rate movements and credit fundamentals, and usually invests at least 80% of its assets in emerging market bonds issued in local currencies. While the mutual fund can invest in bonds issued by companies in emerging markets and other entities, it expects to invest primarily in sovereign bonds issued by emerging market governments.
Currently, it has diversification across more than 15 different emerging market local currencies in Europe, Asia, Latin America, and the Middle East and Africa. Approximate duration is 4.5 years with an average yield to maturity of about 6.4% and over 70% of assets in investment-grade bonds.
2) Matthews Launches China Small Companies Fund
Matthews International Capital Management, advisor to the Matthews Asia Funds, announced the expansion on Wednesday of its fund lineup to include a new portfolio dedicated to investing in Chinese small companies. The Matthews China Small Companies Fund (MCSMX) will seek long-term capital appreciation by investing in the stocks of companies in China, Hong Kong and Taiwan with market capitalizations generally under $3 billion.
Managed by Richard Gao, and co-managed by Henry Zhang, the fund represents the firm’s third China strategy. The number of publicly listed small Chinese companies (excluding A shares, which are generally not available to foreign investors) has nearly doubled in the past five years and now exceeds 1,000, according to the Matthews announcement.
3) IndexIQ Launches Its First ETF Focused on Mid-Cap Japanese Equities
IndexIQ announced on Thursday that it is launching the IQ Japan Mid Cap ETF (RSUN). RSUN is dedicated to providing access to Japan’s mid-cap stock sector, including the industrial, financial and technology sectors, which made up 23.16%, 17.69%, and 9.08%, respectively, of the fund’s underlying index as of May 16.
RSUN seeks to replicate, before fees and expenses, the performance of the IQ Japan Mid Cap Index (IQMDJPN), a float-adjusted market cap-weighted index that tracks the overall performance of the mid-cap sector of publicly traded companies domiciled and primarily listed on an exchange in Japan.
4) Global X Funds Launches the Global X Farming ETF
Global X Funds launched the Global X Farming ETF (BARN) on Thursday. BARN covers the farming sector, focusing on companies involved in agricultural products, livestock operations and the manufacturing of farming equipment.
The Global X Farming ETF tracks the Solactive Global Farming Index, which is designed to measure broad-based equity market performance of global companies involved in the farming industry. It is not an equal-weighted index. To pass the diversification guideline, the index is capped,
which affects the top 10 holdings. As of May 23, the three largest components of the index were Vitierra Inc., Kubota Corp., and Wilmar International Ltd.
5) Putnam Investments to Subadvise Two Mackenzie Fixed-Income Funds
