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First US-Listed ETF to follow the global timber industry


Claymore Securities has launched the Claymore/Clear Global Timber Index ETF on the American Stock Exchange, the first US-listed exchange-traded fund to offer investors exposure to the glob

Claymore Securities has launched the Claymore/Clear Global Timber Index ETF on the American Stock Exchange, the first US-listed exchange-traded fund to offer investors exposure to the global timber sector and Claymore’s 35th ETF to date. The launch also brings the number of ETFs listed on the Amex to 373.

‘Timber has had a historically low correlation to traditional asset classes, which provides investors a unique diversification tool that may help reduce a portfolio’s overall volatility,’ says Christian Magoon, a senior managing director at Claymore Securities and head of the firm’s ETF group.

‘Historically timber has been an asset class available only to institutional investors due to high capital costs. With the launch of the Claymore/Clear Global Timber Index ETF, investors have an investment vehicle that seeks to provide efficient access to the global timber market.’

The Global Timber Index ETF seeks investment results that correspond to the performance of the Clear Global Timber Index. Stocks in the index are selected from timber companies, defined by index provider Clear Indexes as those that own or lease forested land and harvest the timber for commercial use and sale of wood-based products, including lumber, pulp or other processed or finished goods such as paper and packaging.

Index constituents are categorised according to their degree of exposure to timber and have market capitalisations greater than USD300m. Company weights are assigned using a modified market capitalisation weighting method, with no company exceeding 4.5 per cent at the time of each rebalance. The weighting of companies within the index reflects the distribution of forest land worldwide.

The fund will normally invest at least 90 per cent of its total assets in the common stock, American depositary receipts and global depositary receipts that comprise the index. The constituent selection process is carried out annually and the index is rebalanced quarterly. The fund is managers by affiliated company Claymore Advisors.

‘We are pleased to be supporting Claymore as they continue to expand their family of ETFs and provide the investing community with new ways to diversify their portfolios,’ says Scott Ebner, senior vice-president of the Amex ETF marketplace. ‘This is the first US-listed ETF to provide investors access to companies involved in the global timber business.’

At the end of September, Claymore group firms provided supervision, management, servicing or distribution for assets totalling some USD18.4bn in closed-ended funds, unit investment trusts, mutual funds and ETFs.

Clear Indexes, a subsidiary of Clear Asset Management, creates and publishes custom indices to measure specific market segments using a combination of qualitative research and quantitative methods.

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