ISEQ Index Fund Gives US Investors Access To Irish Markets
The Irish Stock Exchange (ISE) has licensed its benchmark ISEQ 20 Index to
Northern Trust Global Investments (NTGI), the asset management arm of Northern
Trust, to create a major new Exchange Traded Fund (ETF) in the United States
of America (US). The NETS™ ISEQ 20™ Index Fund (Ireland), which tracks the performance
of the 20 Irish securities included in the ISEQ 20 Index, commenced trading
on Thursday on the New York Stock Exchange. The new ETF is the latest in a suite of products that are being launched by
Northern Trust under the brand NETS (Northern Exchange Traded Shares),
marking its entry into the ETF business. This suite is designed to facilitate investment exposure for US investors to
some of the world’s most widely recognised international equity benchmarks,
including the ISEQ 20 Index, via ETFs traded on US exchanges. Brian Healy, Director of Traded Markets, Development, Operations at the ISE
explained that: “We have long been advocates of ETFs – as very efficient, cost-effective
securities traded on-exchange they are good for investors, they benefit the
Irish issuers in the ISEQ 20 Index and they raise the profile and brand recognition
of our ISEQ indices generally." "The creation of the NETS ISEQ 20
will facilitate easily accessible investment exposure to Irish equities for
US institutional and retail investors especially the very large Irish-American
community.” Peter K. Ewing, Head of NTGI’s ETF business, added that: “The NETS product line would not be complete without an ETF that
is based on the ISEQ 20 Index. The Irish economy has flourished in recent years,
and its market can be an important source of diversification for US investors.
These facts are at the heart of our partnership with the Irish Stock Exchange.” ETFs continue to grow at an extremely rapid rate globally both in terms of
assets under management (AUM), and in terms of the number of ETFs available to investors.
Morgan Stanley, in its most recent global review of the ETF marketplace, now
estimates that global AUM is in excess of USD800bn, constituting an increase
of 21% over the past year. It also estimates that the total number of ETFs globally grew by 42% over
the same period, with 1,302 on the market at the end of April 2008. It has additionally estimated that global AUM will exceed USD2tn in 2011. Brian Healy concluded: “The new Irish focused ETF has the potential to generate significant
levels of AUM and provides increased profile and visibility for the ISEQ 20
Index in the critically important North American market. It also enhances the
ISE’s ETF credentials and will help to raise awareness levels of ETFs
domestically.” A comprehensive report in our Intelligence Report series examining offshore investment, offshore stock exchanges, trusts and hedge funds is available in the Lowtax Library at http://www.lowtaxlibrary.com/asp/subs_reports.asp and a description of the report can be seen at http://www.lowtaxlibrary.com/asp/description_report9.asp
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