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Portfolio > ETFs

ProShares Unveils Financial ETFs

By Ron DeLegge

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ProShares recently unveiled two industry sector ETFs that offer 300% daily leverage and inverse exposure to financial stocks.

The ProSharesUltraPro Financials (FINU) aims for 3x the daily performance of the Dow Jones U.S. Financials Index, while ProSharesUltraPro Short Financials (FINZ) offers  minus 3x or opposite daily performance to the Dow Jones U.S. Financials Index.

S&P financial stocks (XLF) are ahead by 14.01% since the beginning of the year and are outperforming the broader S&P 500, which is ahead by 8.61%, as of late July.

“Financials have been one of the most dynamic parts of the market and many investors are seeking to manage risk or potentially take advantage of moves by the sector,” said Michael L. Sapir, chairman and CEO of ProShare Advisors LLC, ProShares’ investment advisor.

ProShares also offers a minus 1x financial ETF (SEF), a 2x financial ETF (UYG) and a minus 2x financial ETF (SKF).

FINU and FINZ charge annual expenses of 0.95%. ProShares manages $22 billion in ETF assets.

ProShares ETFs seek returns that are 3x, 2x,  minus 1x, minus 2x or minus 3x of the return of an index for a single day, as measured from one NAV calculation to the next. Because of the compounding of daily returns, ProShares’ returns over periods other than one day will likely differ in amount and possibly direction from the target return for the same period.

In other product news, AdvisorShares, a leading sponsor of actively managed ETFs, launched the Global Alpha & Beta ETF (RRGR).

RRGR employs a broadly diversified global asset allocation strategy seeking to outperform diversified financial indices such as a 60/40 allocation to the S&P 500 Index and the Barclays Capital Aggregate Bond Index. The new actively managed ETF utilizes a top-down investment perspective that focuses on proprietary security and asset class selection by primarily selecting individual stocks, ETFs and American Depository Receipts that provide investment exposure to global markets.

The fund is sub-advised by Your Source Financial, a Phoenix, AZ-based investment advisor, which is led by Roger Nusbaum, Chief Investment Officer. RRGR charges a net annual expense ratio of 1.40%.

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