Mutual fund companies are trying to grab some of the exchange traded fund (ETF) success by launching alternative investment options. Ian Salisbury for The Wall Street Journal dissects the latest offerings: BRIC funds that invest in four target nations: Brazil, Russia, India and China; 130-30 funds; and exchange traded notes (ETNs), which are cousins to ETFs. Before jumping on, remember that these are new funds with short performance records.

• BRIC funds: These mutual funds offer more concentrated exposure to the BRIC countries than an emerging-market fund. Throughout the past several years, these countries have boasted high returns, but the special exposure also means more volatility.
• 130-30: With a similar investment strategy as a hedge fund, these are based on the "long-short" mutual funds. They have "long" holdings on stocks but also have "short" positions in case prices drop. In a 130-30, the investor can bet $100 in a basket of stocks, then short $30 on stocks they believe are overvalued. Those gains are used to buy stocks they think are undervalued. The optimum result is $130 in long stock positions and $30 invested short.
• ETNs: These were created as investment vehicles that could reach otherwise hard-to-reach areas of the market. They are debt securities backed by the issuer linked to the particular benchmark. Investors take on the risk that the issuer could default. Each firm that offers ETNs has high, investment-grade quality credit ratings.

Tags: ETNs, Long-Short ETFs