July 01, 2009 at 12:30 pm by Tom Lydon
MacroMarkets is finally going forward with the launch of their exchange traded funds (ETFs) that track the price of homes in major metro areas a few weeks after the initial public offering was called off.
After a series of delays, including an aborted effort to launch the products via a unique initial public offering in May, the eagerly awaited MacroShares real estate ETFs are finally up and running. Matthew Hougan for Index Universe reports that the funds are designed to deliver 300% and -300% of the return of the S&P/Case Shiller Home Price 10 Index.
The ETFs are:
Under the structure of the ETFs, the up and down Macros hold Treasury securities as their sole asset. As the benchmark index moves up or down, those Treasuries are transferred back and forth between the two funds. The structure allows MacroShares to launch products tied to any reference price, including previously uninvestable benchmarks such as national home prices.
The funds are set to expire on Nov. 25, 2014, at which point investors will receive a payment based on 300% of the change in the underlying index from Dec. 31, 2008-Aug. 31, 2014.
The ETFs are dawning on the market at a time when home prices have been declining. However, analysts suggest that the rate of dropping prices is slowing and the signs of stabilization are showing up, reports Renae Merle for The Washington Post.
For more stories about real estate, visit our real estate category.
Tags: Asset Class ETFs, DMM, Long-Short ETFs, New ETFs, Real Estate, Sector ETFs, UMM
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