New ETF Equal Weights the World
January 13th 2011 at 1:00am by Tom Lydon
Rydex has added another equal weight exchange traded fund (ETF) to its increasingly formidable lineup of funds that have the strategy.
The Rydex MSCI All Country World Equal Weight ETF (NYSEArca: EWAC) tracks the equal-weighted MSCI All County World Index, which tracks more than 2,400 stocks from 24 developed and 21 emerging market countries, reports Olivier Ludwig for Index Universe.
The equal weighting strategy will reduce the exposure to large-cap corporations and give more diversification, as opposed to the traditional market-cap weighted method.
The timing for such strategies is great, considering that we’re emerging from a recession. Such recovery periods tend to put small-caps in favor. The evidence can be seen in the performance of Rydex S&P Equal Weight (NYSEArca: RSP), which handily outperformed the SPDRs (NYSEArca: SPY) in 2010.
Meanwhile, Russell Investments has inked a deal to purchase ETF provider U.S. One, the name behind the One Fund (NYSEArca: ONEF). The details weren’t disclosed, and the deal is expected to close sometime in the current quarter.
Read the disclaimer; Tom Lydon is a board member of Rydex|SGI.
Tisha Guerrero contributed to this category.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Mr. Lydon serves as an independent trustee of certain mutual funds and ETFs that are managed by Guggenheim Investments; however, any opinions or forecasts expressed herein are solely those of Mr. Lydon and not those of Guggenheim Funds, Guggenheim Investments, Guggenheim Specialized Products, LLC or any of their affiliates. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.