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PowerShares unveils fundamentals-based ETF covering international real estate


PowerShares Capital Management, a provider of exchange-traded funds belonging to the Invesco group, has launched a new addition to its series of fundamentals-based ETFs that draw on the FT

PowerShares Capital Management, a provider of exchange-traded funds belonging to the Invesco group, has launched a new addition to its series of fundamentals-based ETFs that draw on the FTSE RAFI methodology.

The PowerShares FTSE RAFI International Real Estate ex-U.S. Portfolio, which has been listed on the NYSE Arca electronic trading platform, covers international real estate companies outside the US.

‘Our FTSE RAFI International Real Estate portfolio will give US-based investors unique access to an exciting group of real estate companies domiciled in developed markets outside the US,’ says PowerShares president and chief executive Bruce Bond.

‘Global economies are booming, and these funds provide fundamentally-weighted exposure to real estate activity in developed markets around the world. PowerShares is committed to helping investors achieve alpha through its broad and diversified family of intelligent ETFs.’

PowerShares’ global series of fundamentals-based portfolios are based on the FTSE RAFI global indices, which are constructed using four fundamental measures of a firm’s size, book value, cash flow, sales and dividends.

The equities with the highest fundamental strength are then weighted according to their fundamental scores, rather than free-float market capitalisation as with conventional indices. The PowerShares fundamentals-weighted portfolio is rebalanced and reconstituted annually.

The underlying FTSE RAFI index, which is adjusted quarterly, aims to track the performance of real estate companies with the greatest fundamental value. It comprises some 150 companies with market capitalisations between USD198m and USD49.2bn domiciled in Australia, Austria, Belgium, Canada, China, Finland, France, Germany, Hong Kong, Israel, Italy, Japan, the Netherlands, the Philippines, South Africa, Singapore, Spain, Sweden, Switzerland, Taiwan and the UK.

PowerShares Capital Management has built up a family of more than 100 US and international ETFs that seek to outperform traditional benchmark indices. The firm manages assets exceeding USD35bn.

Invesco operates in 20 countries and offers retail, institutional and high net worth clients investment management products and services through the AIM, Atlantic Trust, Invesco, Perpetual, PowerShares, Trimark and WL Ross brands.

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