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Joint venture launches first target date ETFs


Amerivest Investment Management, a subsidiary of TD Ameritrade, and XShares Advisors have established a joint venture, TDAX Funds, to launch a series of target-date exchange-traded funds i

Amerivest Investment Management, a subsidiary of TD Ameritrade, and XShares Advisors have established a joint venture, TDAX Funds, to launch a series of target-date exchange-traded funds incorporating automatic asset allocation between shares and bonds.

The new venture aims to provide diversified goal-based investing options through an initial series of five underlying life-cycle ETFs. ‘Whether you’re looking for a complete solution or adding to a goal-based strategy, TDAX Independence ETFs keep it simple, making it a great choice for both sophisticated investors and those just beginning,’ says TD Ameritrade senior vice-president Dave Kelley.

The target-date funds begin by focusing on asset growth through a higher weighting to stocks and shift to capital preservation over time through historically less-risky allocations. The funds seek to replicate lifecycle indices created by Zacks Investment Research.

The indices are designed to draw exposure from three broad asset classes of international equities, US equities and fixed-income, and are reconstituted and rebalanced annually, or quarterly when necessary, according to the Zacks methodology.

‘We are thrilled to partner with senior vice president,’ says Jeffrey Feldman, founder and chairman of New York -based XShares Group. ‘We built our private-label platform for just this purpose, and are pleased to have one of the most prestigious financial institutions in the US as our first partner.’

The first five TDAX Independence ETFs to be launched, each with strategies defined by an investment horizon and target date, are the TDAX Independence In-Target ETF, TDAX Independence 2010 ETF, TDAX Independence 2020 ETF, TDAX Independence 2030 and TDAX Independence 2040. The funds are traded on the NYSE Arca electronic trading platform.

‘NYSE Arca welcomes these five innovative TDAX Independence ETFs, the first to offer investors a systematically managed position in a multi-asset target-date exchange-traded fund,’ says NYSE Group senior vice-president for ETFs and indices Lisa Dallmer.

‘Tracking the performance of the Zacks Lifecycle Indexes, the TDAX Independence ETFs provide a mix of components and assets that change to reflect the holder’s proximity to a target date. These products provide an investment solution, all in one ETF and a truly ground-breaking approach to managing your financial future.’

Following the listing of the TDAX ETFs, NYSE Group markets have 219 primary ETF listings and trade all other eligible ETFs on an Unlisted Trading Privileges basis. In the first half of 2007, the group handled 43 per cent of all ETF shares traded in the US market.

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