UBS rebrands internet-sector ETNs to reflect IPO focus

Nov 27th, 2011 | By | Category: Equities

UBS, the Swiss-based bank behind the ETRACS range of ETNs, has renamed its internet-focused ETNs.

UBS rebrands internet-sector ETNs to reflect IPO focus

UBS rebrands internet-sector ETNs to reflect IPO focus.

The company has advised that the ETRACS Internet IPO ETN will now be known as the ETRACS Next Generation Internet ETN, while its double-exposure sibling will be called the ETRACS Monthly 2x Leveraged Next Generation Internet ETN.

Their underlying index, the UBS Internet IPO Index, has also been renamed and will now be known as the UBS Next Generation Internet Index.

These name changes, UBS say, are designed to emphasise the products’ focus on only the most recently floated internet companies – those that have had their IPO within the past three years.

UBS is hoping that by adding a “Next Generation” label to its internet-linked ETNs it will be better able to differentiate its products from other more traditional, broad-based internet investment vehicles.

Indeed, the ETRACS Next Generation Internet ETNs are unique in that they only track companies that have been publicly listed for fewer than three years. They therefore don’t include internet stalwarts such as Google, Amazon or eBay, all of which had their IPOs outside of the three-year window UBS is focused on.

While these particular UBS ETNs haven’t yet gathered significant assets, UBS’ move underscores the growing popularity of internet-focused strategies with investors.

The recent flotation of social media giant LinkedIn, which still trades above its IPO price despite tough markets, as well as the IPOs of Groupon and Pandora Media, both of which received much media coverage, demonstrate investors’ increased appetite for investments in the internet and social media space.

The most notable recent ETP launch in this space has been the Global X Social Media ETF which tracks a proprietary benchmark of 25 social media stocks, including names such as Groupon, LinkedIn, Pandora, Google, Tencent, Sina and Netease.com.

The Global X Social Media ETF’s underlying index is designed to reflect the performance of companies involved in the social media industry, including companies that provide social networking, file sharing, and other web-based media applications.

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