Industry Updates

An ETF to save the media is 100% foolish

David Tuckwell

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Today's new ETF listings from around the world.


The Motley Fool lists a "100% foolish" ETF

The Motley Fool, the funds management division of the media company, is listing a new ETF that tracks an index that's "100% foolish". The Motley Fool 100 Index ETF (TMFC) will track the 100 largest and most liquid US companies "that have been recommended by The Motley Fool's analysts and newsletters," the prospectus says.

To qualify in the index, companies must be among the 100 largest domestic firms by market capitalization in The Motley Fool's "recommendation universe." Companies fall within this milky way if they're featured in The Motley Fool's newsletter or feature in the top 150 rated US companies by the company's analyst opinion database.

Companies chosen are weighted by their market capitalisation, which is rebalanced quarterly.

ETF Stream Analysis

It's tough times for media companies. Faced with declining subscription and advertising revenues, media companies have come up with new ways to make money. Paid content and advertorials is one, conferences are another. But never before has a media company taken to listing an ETF -- and using its own reporting and analyses to pick the stocks at that. (Maybe ETF Stream should do this too. We've certainly read enough prospectuses.)

On a more serious note, the new fund looks quite similar to other US large cap trackers. Going through the index fact sheet, the top ten holdings at the time of writing are: Apple, Alphabet, Microsoft, Amazon, Berkshire Hathaway, Facebook, Johnson & Johnson, Visa, United Health and Home Depot. These holdings make TMFC resemble an S&P500 ETF. The Motley Fool will have to explain to investors why they should prefer its brand to established index providers'.

Another thing to consider is the US large cap space is the most cut throat of any portion of the ETF landscape. Big issuers in the US are now charging as little as 3 basis points for funds that provide exposure to the largest and most liquid US companies. They can afford to because the world's largest fund managers have the scale and brand recognition. But given how competitive this space is, listing a product that tracks US large caps could prove a steep climb. Still, one wishes The Motley Fool the best of luck.


Daishin lists two new commodity ETNs

Korean issuer Daishin is listing two new iron ore ETNs. They are:

  • Daishin Securities Daishin Iron Ore Futures ETN H 8 (510008)

  • Daishin Securities Daishin Inverse Iron Ore Futures ETN H 9 (510009)


State Street to attack fixed income space

State Street is listing a new bond ETF at a highly competitive price that tracks global bonds. The SPDR Bloomberg Barclays Global Aggregate Bond UCITS ETF (GLAG, GLBL) will track the Bloomberg Barclays Global Aggregate Bond Index, which provides a measure of performance of bonds from around the world of various ratings and types.

From what information is available at present it seems to be quite similar to other State Street bond ETFs like the SPDR Bloomberg Barclays U.S. Aggregate Bond UCITS ETF (USAG) and SPDR Bloomberg Barclays Euro Aggregate Bond UCITS ETF (EAGG).

One imagines it will compete with the iShares Global Aggregate Bond UCITS ETF (AGGG), which appears to track a similar index. A factsheet is available here.

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