New ETFs’ Creator in Question

Last week, WisdomTree launched twenty new exchange traded funds, focusing on dividend paying equities.  Investment News reports the ETFs may be an encroachment "on the intellectual property of Robert Arnott, chairman of Research Affiliates LLC."

Mr. Arnott selects and weighs index components based on sales, income, book value and dividends.

WisdomTree’s ETFs select securities based on either the amount of cash dividends companies pay or the dividend yield of the companies in the index.

Mr. Arnott does not seem to be seeking legal action, but feels the problem will be worked out.

WisdomTree does not see a problem.  A spokesperson from the company said, "WisdomTree Investments is the sole creator and owner of all intellectual property rights in its unique index methodology.  Any assertion to the contrary is without merit."