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Cushing Launches Income-Focused Equity Sector & MLP ETFs: Portfolio Products

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Cushing Asset Management launched a new suite of income-focused equity sector and MLP exchange-traded funds, The Cushing Sector Plus ETFs.

These new ETFs, which trade on the NYSE Arca Exchange, are designed to offer investors exposure to the master limited partnership and energy infrastructure markets by seeking to replicate the performance of custom indexes in energy, utilities, transportation, and the energy supply chain.

The new funds include: the Cushing Energy & MLP ETF (XLEY), which tracks the Cushing Energy Index; the Cushing Utility & MLP ETF (XLUY), which tracks the Cushing Utility Index; the Cushing Transportation & MLP ETF (XLTY), which tracks the Cushing Transportation Index; and the Cushing Energy Supply Chain & MLP ETF (XLSY), which tracks the Cushing Energy Supply Chain Index.

“Selecting existing sector indexes that operate fundamentally related businesses to energy MLPs, weighting the constituents on indicated yield, and adding a limited amount of MLPs is designed to produce a higher yield focus while maintaining the desired sector exposure,” Todd Sunderland, head of risk management and quant strategies at Cushing Asset Management, said in a statement.

Through a custom yield-weighted approach, constituents of the Cushing indexes are selected from the S&P 500 Energy Index (SPN), S&P 500 Utility Index (S5UTIL), S&P 500 Materials Index (S5MATR), and the Dow Jones transportation average (TRAN), and then combined with constituents from the Cushing 30 MLP Index (MLPX).

Each of the Cushing indexes, and consequently the funds, limit the exposure of MLPs to 24% at each rebalance, allowing investors to add the income-generating potential that MLPs can bring to a portfolio, but avoiding the receipt of Schedule K-1 come tax time.

All four new ETFs have an expense ratio of 0.65%.

North Capital Launches REITless Impact Income Strategies

North Capital Investment Technology Inc. recently launched a new investment vehicle, REITless Impact Income Strategies.

The new strategies are focused on lending and strategic debt investments to primarily single- and multifamily real estate development and redevelopment projects that aim to produce positive social impact in communities nationwide.

The impact initiatives targeted by the company are energy efficiency, employment generation, affordable housing, and green-housing improvements that promote environmental sustainability.

REITless intends to focus on making short-term loans and investments into the small-balance real estate market, where financing requirements are typically smaller than in institutional markets.

Unlike many REITs, investors in REITless will not pay upfront selling commissions as part of the purchase price, which may allow investors to compound a greater percentage of their investment.

REITless membership interests are available to both accredited and non-accredited investors who meet the qualifications of the offering.

REITless is managed by North Capital Inc., an SEC-registered investment advisor.

Bloomberg Launches 2019 Gender-Equality Index

Bloomberg announced the launch of its 2019 Gender-Equality Index, which this year selected 230 companies committed to transparency in gender reporting and advancing women’s equality in the workplace.

The index more than doubled in size from 2018 and includes firms from 10 sectors headquartered across 36 countries and regions.

Collectively, these firms have a combined market capitalization of $9 trillion and employ more than 15 million people — including 7 million women — around the world. Argentina, mainland China, Israel and South Africa are among the 13 markets represented for the first time this year.

Bloomberg’s reporting framework provides a comprehensive, standardized format for companies to voluntarily disclose information on how they promote gender equality across four distinct areas: company statistics, policies, community engagement and products and services.

Reporting companies that score above a globally established threshold, based on the extent of their disclosures and the achievement of best-in-class statistics and policies, are included in the Gender-Equality Index.

Currently, only 10% of eligible companies are disclosing their workplace gender policies and practices.

The Bloomberg gender reporting framework is voluntary and has no associated costs. The Gender-Equality Index is a reference index.

FTSE Russell Launches Chinese Green Bond Index Series

FTSE Russell launched a new index series tracking Chinese green bonds.

The FTSE Chinese (Onshore CNY) Green Bond Index Series will benchmark securities whose proceeds are specifically used to finance climate or environmental projects in mainland China.

The index will measure the performance of onshore Chinese yuan-determined fixed-rate government, agency and corporate debt issued that are labelled “green” by the issuer.

There are currently 126 bonds included in the main index, covering approximately 75% of all on-shore labelled green bonds issued by China’s government, agencies and corporations.

The FTSE Chinese Green Bond Index Series use evaluated prices from Refinitiv, an independent price provider. The indexes will be rebalanced once a month on the last business day of the month.

FTSE Russell Launches Country Classification Framework for Fixed Income

FTSE Russell also recently introduced a country classification process for fixed income.

The newly introduced fixed income framework, which will complement the firm’s existing equity country classification process, was developed in consultation with market participants.

The framework will assign countries tracked by its fixed income indexes a level of 0, 1 or 2 – with 2 representing the highest level of accessibility for foreign investors.

Minimum Market Accessibility Levels will replace the barriers-to-entry criteria for the methodology for the flagship FTSE World Government Bond Index (WGBI) and FTSE Emerging Markets Government Bond Index (EMGBI), effective March 30.

FTSE Russell will publish a watch list of local currency, fixed-rate government bond markets being considered for potential reclassification of their Market Accessibility Level for either failing to meet the accessibility thresholds of their existing level or are close to meeting the thresholds for a higher level.

These levels will be reviewed annually in September and are also available for use in bespoke index construction.

Direxion Launches 3X Leveraged, Inverse ETFs on New GICS Communication Services Sector

Direxion added two ETFs to complete its synchronization with the Global Industry Classification Standard (GICS) sector changes implemented by S&P Dow Jones in September.

These new ETFs — Direxion Daily Communication Services Index Bull 3X Shares (TAWK) and Direxion Daily Communication Services Index Bear 3X Shares (MUTE) — offer 300% exposure to the newly expanded and renamed Communication Services Select Sector Index.

The Communication Services sector now reflects today’s modern means of facilitating communications and delivering information, broadened to include not just telecom titans such as AT&T, but major internet and IT industry players such as Netflix and Facebook. The new composition means the sector will offer potentially more growth-oriented exposure than the old value-oriented telecommunication services sector, as well as become more cyclical than defensive.

Like all leveraged and inverse ETFs, these Direxion products are intended only for investors with an in-depth understanding of the risks associated with seeking leveraged and inverse investment results, and who plan to actively monitor and manage their positions.

Grayscale Launches Stellar Lumens Trust

Digital currency asset manager Grayscale Investments launched a single-asset investment product that provides exposure to Lumens (XLM), the native asset of the Stellar network.

The Grayscale Stellar Lumens Trust is available to institutional and accredited individual investors.

Stellar is a platform that connects financial institutions, payment systems, and people around the world. The platform is designed to provide low-cost financial services to fight poverty and income inequality and foster individual growth.

Lumens is the native asset of the Stellar network that enables users to move money around the world and conduct transactions between different currencies quickly and securely.

This is the ninth single-asset investment product introduced by Grayscale, which also manages Grayscale Digital Large Cap Fund, a diversified investment product that provides exposure to the top digital currencies by market cap.

— Read last week’s portfolio product roundup here: ProShares to Launch 4 Leveraged ETFs: Portfolio Products


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