Old Mutual Global Index Trackers has launched an ETF based on the emerging markets with zero fees for a limited period.
The African asset manager has listed the GlobalShares FTSE Emerging Markets fund on NYSE Arca, under a temporary zero-fee arrangement. The zero-fee will last until the end of January 2010, or until the net assets of the fund exceed $1bn, whichever is earlier.
The firm plans to list up to four more global and emerging market ETFs in the US early next year, under the trading name of GlobalShares. Old Mutual is also planning to follow this with similar products for Europe and South Africa.
Old Mutual Investment Group South Africa CEO Thabo Dloti says: "This is the first emerging market ETF managed from an emerging market."
He adds many large financial services groups are charging far more in the US for emerging markets ETFs than for standard domestic ETFs, and that tracking errors are typically high.
He says: "We realised there was an opportunity we could exploit due to our low costs and history of low tracking errors. We are committed to being the low-cost provider of choice for emerging markets exposure."
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