ETF Deathwatch for June 2011: Sixteen New Names

Sixteen new names joined ETF Deathwatch for June.  Eleven just emerged from the six-month grace period I give all new launches, while the other five have been around longer.  Seven products came off the list this month.  The net increase of nine places the current count at 148, which is 13.3% of the eligible products.

Seven of the new members are among the New iPath ETNs With Indescribable Leverage introduced last November.  I used to joke that Barclays must have sold their product marketing team to BlackRock as part of the iShares transaction.  Now the humor is fading away as Barclays offers new products whose names have no logical connection to what the products really are.

The five new “aged” funds added this month are:

1. HOLDRS Internet Infrastructure (IIH) – has been around for more than 11 years yet currently has less than $12 million in assets and little trading activity.  I believe the HOLDRS structure has outlived its usefulness.
2. iShares FTSE NAREIT North America (IFNA) – is 3.5 years old, has $13.7 million in assets, and average daily volume less than 1,400 shares.
3. JPM Quarterly Double Short US Long Treasury Futures ETN (DSTJ) – traded only six days in May for a monthly total of only 2,300 shares.  If you didn't even know there was such a thing as JPMorgan inverse Treasury ETNs with dual reset mechanisms, that's okay.  Apparently no one else does either.
4. PowerShares Dynamic Consumer Discretionary (PEZ) – is the third PowerShares “Dynamic” ETF to go on Deathwatch.  Aware of the problems, PowerShares intends to change the name, indexes, and ticker symbols for its suite of 10 Dynamic Style Box ETFs to FTSE RAFI Fundamental Pure Style Box ETFs effective 6/16/11.
5. WisdomTree International Hedged Equity (HEDJ) – has assets above $21 million, but trading activity rarely exceeds three digits.  The “hedged” stands for currency-hedged, which has been a less than optimal strategy in the face of a declining dollar.

Twenty-five new ETPs came to market last November and were granted immunity from ETF Deathwatch the past six months.  Fourteen show early signs of success.  The other eleven do not, and join the list for June:

1. iPath Long Enhanced MSCI EAFE Index ETN (MFLA) – is a 2x leveraged ETN with no-reset and fees of about 1.40% (review of  iPath ETN product launch).
2. iPath Long Enhanced MSCI Emerging Markets Index ETN (EMLB) – is a 2x leveraged ETN with no-reset and fees of about 1.40%.
3. iPath Long Extended Russell 1000 TR Index ETN (ROLA) – is a 3x leveraged ETN with no-reset and fees of about 1.10%.
4. iPath Short Enhanced MSCI EAFE Index ETN (MFSA) – is a 2x leveraged inverse ETN with no-reset and fees of about 2.55% (not a typo).
5. iPath Short Enhanced MSCI Emerging Markets Index ETN (EMSA) – is a 2x leveraged inverse ETN with no-reset and fees of about 3.30% (not a typo).
6. iPath Short Extended S&P 500 TR Index ETN (SFSA) – is a 3x leveraged inverse ETN with no-reset and fees of about 0.85%.
7. iPath Short Extended Russell 1000 TR Index ETN (ROSA) – is a 3x leveraged inverse ETN with no-reset and fees of about 1.50%.
8. PIMCO Broad U.S. Treasury Index Fund (TRSY) – only traded on five days in May and averages a pitiful 90 shares per day.  I questioned the necessity of this fund when it  launched.  The PIMCO name is apparently not enough to thrive in this market.
9. VelocityShares Daily 2x VIX Medium-Term ETN (TVIZ) – is one of the two medium-term non-inverse products from newcomer VelocityShares suite of volatility ETNs introduced in November.
10. VelocityShares VIX Medium-Term ETN (VIIZ) – is the other one of the two.  Four other ETNs rolled out at the same time by VelocityShares are enjoying strong investor interest.
11. UBS E-TRACS Wells Fargo MLP Index ETN (MLPW) – is probably too late arriving at the MLP party and doesn't offer anything new.

The following seven products escaped from ETF Deathwatch for June:

1. Barclays ETN+ Short D Leveraged Exchange Traded Notes Linked to the Inverse Performance of the S&P 500 Total Return Index (BXDD) – came off the list because BXDD bit the dust.  In case you are wondering, it was 3x inverse leverage with no-reset, or “Short D” in Barclays' terminology.  See what I mean about Barclays' product naming?
2. Barclays GEMS Currency Index ETN (JEM) – assets swelled from below $5 million to nearly $90 million, an 18-fold increase.  You can't tell by trading activity though, as it only traded on one of the last five trading days in May.  I have to wonder if someone made a typo when publishing the ‘shares outstanding' data on the Barclays website.
3. iShares S&P Target Date 2020 Index Fund (TZG) – assets still in $17 million range but trading activity picked up the last three months.
4. ProShares UltraShort DJ-UBS Commodity (CMD) – saw a surge in both assets and trading activity from the commodity correction in May.
5. PowerShares Active Low Duration (PLK) – assets still in $11 million range but trading activity is picking up.
6. RevenueShares Navellier Overall A-100 (RWV) – assets still in $10 million range but trading activity is growing.  The people at RevenueShares are extremely sensitive about ETF Deathwatch, so they should welcome this news.
7. UBS E-TRACS CMCI Silver TR ETN (USV) – assets still in $10 million range but trading activity picked up the past three months.

The ETF Deathwatch criteria produced the following list of 148 names for June:

ETF Deathwatch for June 2011

Data sources:  AUM from National Stock Exchange, daily prices and volume of individual ETPs from Norgate Premium Data, and all other information compiled by Invest With An Edge.

Past issues of ETF Deathwatch are available here.

Disclosure covering writer, editor, and publisher: No positions in any of the securities mentioned. No positions in any of the companies or ETF sponsors mentioned.  No income, revenue, or other compensation (either directly or indirectly) received from, or on behalf of, any of the companies or ETF sponsors mentioned.