Lyxor launches nine US equity sector ETFs

Feb 17th, 2012 | By | Category: Equities

Paris-based Lyxor has launched a family of ETFs tracking the core US S&P 500 equity sectors.

Lyxor launches nine US equity sector ETFs

Lyxor has launched nine US equity sector ETFs charging just 0.20% per annum.

The funds have been listed on Euronext in Paris and employ a 20% cap-weighting in order to comply with UCITS rules. All nine ETFs use synthetic replication to deliver the performance of their respective benchmark indices.

Aimed at European investors, the funds compete directly with London-based Source’s comparable range of ETFs, which, like Lyxor’s, are based on S&P Select Sector Capped 20% Indices. The Lyxor offerings, however, come with a total expense ratio of 0.20%, ten basis points less than Source’s management fee of 0.30%.

Both Lyxor and Source will be hoping to emulate the success of SSgA’s US-based family of Select Sector SPDR ETFs, which charge a fee of 0.18% and have over $47 billion in combined assets under management.

The S&P Select Sector Capped 20% Indices consist of nine sector indices included in the S&P 500.  All stocks included in the series are classified according to the Global Industry Classification Standard (GICS) and maintain the same classification as that found in the parent S&P 500.

S&P Indices’ classification enables investors to compare the performance of one sector against another, as well as compare sectors regionally. While GICS is divided into 10 sectors, the S&P Select Sector Capped 20% Indices combine the Telecommunication Services and Information Technology sectors into one sector – Technology.

The nine sectors are consumer discretionary, consumer staples, energy, financials, health care, industrials, materials, technology and utilities.

The indices follow a modified market-capitalisation weight methodology.  The weight of each stock is based on its float-adjusted market cap but is modified such that no stock has a weight over 20% of the index as of each quarterly rebalancing.

The funds are as follows:

Lyxor ETF S&P 500 Capped Financials Sector (FINU)

Lyxor ETF S&P 500 Capped Consumer Discretionary Sector (CODU)

Lyxor ETF S&P 500 Capped Energy Sector (NRGU)

Lyxor ETF S&P 500 Capped Consumer Staples Sector (COSU)

Lyxor ETF S&P 500 Capped Utilities Sector (UTLU)

Lyxor ETF S&P 500 Technology Sector Capped (TNOU)

Lyxor ETF S&P 500 Capped Materials Sector (MATU)

Lyxor ETF S&P 500 Capped Industrials Sector (INDS)

Lyxor ETF S&P 500 Capped Health Care Sector (HLTU)

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