Van Eck Global and Merrill Lynch have struck a deal that would allow investors in six HOLDRS the chance to exchange these investments for shares of new Market Vectors exchange traded funds, Van Eck said early Friday.
The six HOLDRS—Oil Services (OIH), Semiconductor (SMH), Pharmaceutical (PPH), Biotech (BBH), Retail (RTH) and Regional Bank (RKH)—had about $3.65 billion in assets and a combined 30-day average daily trading volume of roughly 20.07 million shares as of Thursday.
Terms of the transaction were not disclosed. Merrill Lynch is expected to de-list the HOLDRs after the transaction, according to Van Eck.
Holding company depository receipts, or HOLDRs, are a product created by Merrill Lynch that trade daily on the American Stock Exchange. They allow investors to buy and sell a basket of stocks in a particular sector, such as biotech or Internet.
“As a leading provider of exchange-traded funds, Van Eck Global is an excellent partner for us on this transaction,” said Liam O’Neil, head of market-linked solutions at Merrill Lynch, in a statement.
Van Eck said in a news release that the arrangement should allow participating investors to have “uninterrupted exposure to target industries.”