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ETF Watch: January 22 – January 28
By Heather Bell | January 29, 2009

Page 1 of 2

Page 1: New ETF listings
Page 2: The complete list of ETFs (and ETNs) in registration

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NEW LISTINGS

First Airlines ETF Rolls Out

Claymore became the first-mover in yet another industry space, with the launch of the Claymore/NYSE Arca Airline ETF (NYSE Arca: FAA) on Monday. FAA is the first airlines-specific ETF to launch in the U.S.

The Claymore ETF is a pure-play modified market-cap-weighted passenger airline ETF that will be rebalanced quarterly. FAA holds 25 global airline stocks, 70% domestic and 30% international. The top three stocks in each category will be weighted 15% in the case of domestic, and 4.5% in the case of international airlines. All holdings must derive at least 50% of their business from passenger airline activity.

Some 70.1% of FAA's holdings are in U.S. stocks, with another 4.7% in Germany. The remaining markets represented, in order, are: Singapore (4.3%); France (3.7%); Ireland (2.8%); Britain (2.3%); Japan (2.2%); Canada (1.6%); Brazil (1.4%) and Australia (1.4%).

Continental is its top name, at 14.8% of assets, followed by: Southwest (11.8%); AMR (11.1%); UAL (5.5%) and Deutsche Lufthansa (5%).

The airlines industry can be a bit volatile, but as it seems to be coming out of a deep crater, some traders are betting airlines as a whole will leap out of recession and become a leader once economic times start to improve.

FAA charges 0.65%.

Read the prospectus here.

BGI Launches Two Fixed-Income ETFs...

Barclays Global Investors made its first launches of 2009 last Friday, with the rollout of two international Treasury exchange-traded funds on the NASDAQ.

The iShares S&P/Citigroup International Treasury Bond Fund (NasdaqGM: IGOV) and the iShares S&P/Citigroup 1-3 Year International Treasury Bond Fund (NasdaqGM: ISHG) are both based on indexes tracking Treasury bonds that are issued in local currencies by developed markets other than the U.S., although ISHG is limited to bonds with maturities between one and three years.

The 19 countries represented in the indexes are Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Japan, the Netherlands, Norway, Portugal, Spain, Sweden, Switzerland and the United Kingdom.

Both new iShares international bond funds are expected to wind up charging 0.35% annually in expense ratios.

You can view the prospectus for the ISHG here and for IGOV here.

... And So Does State Street

On Tuesday, State Street Global Advisors launched the SPDR Barclays Capital Short Term International Treasury Bond ETF (NYSEArca: BWZ) and the SPDR Barclays Capital Mortgage Backed Bond ETF (NYSEArca: MBG).

BWZ targets international investment-grade debt issued in local currencies with maturities of one to three years. In addition to developed markets, the underlying index includes issues from countries like South Korea, Poland, Hungary and South Africa. Japan, Germany and Italy, however, are the top three countries represented in the index. As of Jan. 27, BWZ had 18 different holdings.

The fund is very similar to the iShares S&P/Citigroup 1-3 Year International Treasury Bond Fund (NasdaqGM: ISHG), except it includes emerging market debt, whereas ISHG has only developed market holdings.

BWZ charges 0.35% in annual expenses, the same as ISHG.

MBG, the other ETF rolled out on Tuesday, tracks the Barclays Capital U.S. MBS Index, which covers investment-grade, U.S. agency mortgage-backed securities. MBG's benchmark tracks 1,700 components, but its portfolio holds 14 components. It charges 0.20% in annual expenses.

Read the prospectus here.

RevenueShares Rolls Out Sales-Weighted Fund

The RevenueShares Navellier Overall A-100 Fund (NYSEArca: RWV) launched on Monday.

Its underlying index selects its components from a universe of some 4,800 stocks, mainly based on top-line sales. The index had McDonald's as its top holding, at 10.01%, with four other stocks in its top 10 holdings—including Express Scripts, Hess Corporation, Occidental Petroleum, and General Mills—hovering between 6-7% each.

The Navellier Overall A-100 Index is reconstituted quarterly and was developed by Louis Navellier, a well-known growth-minded mutual fund and institutional money manager. Essentially, it arrives at its component list by using quantitative screens in combination with several equal-weighted factors: sales growth, operating margin growth, earnings-per share growth, earnings revisions, earnings surprises, earnings momentum, return on equity and free cash flow.

The new RWV is expected to wind up with a net expense ratio of 0.60%.

Read the prospectus here.

CLOSINGS

Northern Trust's NETS Family To Close

In a surprising move for investors, Chicago-based Northern Trust says it will close all 17 of its exchange-traded funds on Feb. 20.

The decision to shutter the Northern Exchange Traded Shares, or NETS, with about $33 million in assets heading into 2009, was made in consultation with trustees of the funds, according to a terse statement issued before markets closed on Tuesday.

"The board considered current market conditions, the inability of the funds to attract significant market interest since their inception, their future viability as well as prospects for growth in the funds' assets in the foreseeable future," said the release.

In all, Northern Trust had filed with regulators to launch about 27 different ETFs. And several were designed to create access for individual investors and their advisors to markets that hadn't been available in the past. According to its filings, Northern Trust had 20 specific-country NETS in the works, along with four international REIT funds and three global funds. In all, 17 of those funds were actually launched, and ultimately, it seems they simply had too few assets spread across too many ETFs.

The last day of trading for the existing NETS is set to be Feb. 9 on the NYSE Arca. Persons holding shares in the funds after the delisting date will receive a cash distribution equal to the net asset value of their shares as determined on Feb. 20, the date of liquidation.

The funds being closed include the following: