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October 19, 2012 at 10:30 AM
New products introduced over the last week include a new short-term TIPS index fund and ETF from Vanguard; a suite of new and existing ETFs from iShares; a new index launched by S&P Dow Jones Indices; and a new mutual fund from Goldman Sachs Asset Management.
In addition, UBS launched a new ETN; Invesco PowerShares offered a new ETF; Securian announced a turnkey asset management program; and Brown Brothers Harriman said it will close a fund to new investors.
Here are the latest developments of interest to advisors:
1) Vanguard Introduces Short-Term TIPS Index Fund and ETF
On Tuesday, Vanguard launched the Vanguard Short-Term Inflation-Protected Securities Index Fund (VTIP), which offers low-cost conventional shares and ETF shares and seeks to track the performance of the Barclays U.S. Treasury Inflation-Protected Securities (TIPS) 0-5 Year Index. Vanguard’s fixed income group will serve as investment advisor, and co-managers are Joshua Barrickman and Gemma Wright-Casparius.
The estimated expense ratios of the four share classes are 0.07% (institutional shares); 0.10% (admiral and ETF shares); and 0.20% (investor shares). The Treasury inflation-protected securities fund and ETF categories have average expense ratios of 0.82% and 0.20%, respectively (source: Lipper). To help defray the transaction costs of purchasing TIPS, the fund assesses a 0.25% purchase fee on all non-ETF shares.
2) iShares to Launch Core Series ETFs
BlackRock announced the launch of the iShares Core Series, a suite of four new and six existing U.S. ETFs designed for the needs of long-term, buy-and-hold investors. The firm also announced that iShares is launching a global brand initiative and integrating the iShares and BlackRock U.S. retail sales teams.
The new suite consists of the following iShares ETFs: Core S&P Total U.S. Stock Market ETF (ITOT, formerly ISI; Core S&P 500 ETF (IVV); Core S&P Mid-Cap ETF (IJH); Core S&P Small-Cap ETF (IJR); Core MSCI Total International Stock ETF; Core MSCI Emerging Markets ETF; Core MSCI EAFE ETF; Core Total U.S. Bond Market ETF (AGG); Core Long-Term U.S. Bond ETF (ILTB, formerly GLJ); and Core Short-Term U.S. Bond ETF.
3) Emerging Markets Core Index Launched by S&P Dow Jones Indices
S&P Dow Jones Indices announced Tuesday that it has launched the S&P Emerging Markets Core Index, which provides core emerging-market exposure through an investable stock portfolio that is diversified by country, sector and industry. It also announced that it has licensed the new index to EGShares, the ETF offering of Emerging Global Advisors (EGA), to list an ETF on the NYSE Arca.
The S&P Emerging Markets Core Index seeks to reduce concentration in legacy frontier market sectors, broaden country diversification and tap into available liquidity to gain exposure to emerging industries. It focuses on industry groups rather than sectors as index building blocks, equal weights emerging-market constituents, caps country exposures, and contains no developed-market companies.
4) Goldman Sachs Asset Management Announces New Mutual Fund for DC Plans
Goldman Sachs Asset Management has announced a new mutual fund. The Goldman Sachs Retirement Portfolio Completion Fund (A shares: GRPOX) offers defined contribution plan sponsors and investors access to the diversifying nontraditional asset classes used by pension plans, in a single daily valued mutual fund. GRPOX’s performance benchmark is a composite of the S&P 500 Index (60%) and the Barclays US Aggregate Bond Index (40%). Additionally, GSAM created a proprietary retirement portfolio completion benchmark.
