New York-based asset manager Van Eck Global has launched the Market Vectors-Lehman Brothers AMT-Free Long Municipal Index ETF on the American Stock Exchange.
New York-based asset manager Van Eck Global has launched the Market Vectors-Lehman Brothers AMT-Free Long Municipal Index ETF on the American Stock Exchange. The exchange-traded fund offers investors exposure to investment-grade municipal bonds with a nominal maturity of 17 years or more.
The fund seeks to replicate, before fees and expenses, the price and yield performance of the Lehman Brothers AMT-Free Long Continuous Municipal Index. Lehman Brothers is the world’s largest provider of fixed-income benchmarks and producer of some of the most widely followed benchmarks in the global debt markets.
Issues in the underlying Lehman Brothers index are investment grade and exempt from the US alternative minimum tax. The new ETF, which has an expense ratio of 0.24 per cent, joins the Market Vectors-Lehman Brothers AMT-Free Intermediate Municipal Index ETF, launched by Van Eck on the Amex last month.
‘I like to think of [the ETFs] as offering ‘more munis for the money’,’ says Jan van Eck, a principal at the eponymous asset management firm. ‘I believe they have a unique combination of benefits for many investors, including a structure that offers the potential for enhanced yield through broader diversification of index constituents.’
Last month, the Securities and Exchange Commission declared effective the registration statement for six new Market Vectors municipal bond funds, including three national municipal bond ETFs, two state specific municipal ETFs (California and New York) and a high-yield municipal ETF.
Founded in 1955, Van Eck Global managed more than USD9.2bn in assets for individuals, insurers and institutional investors at the end of last year, focusing on hard assets, emerging markets, precious metals including gold, and other specialised asset classes.
In addition to the municipal bond funds, Van Eck offers seven other Market Vectors ETFs covering agribusiness, environmental services, gold miners, nuclear energy and steel, all listed on the Amex, and global alternative energy and Russia (listed on NYSE Arca).
The seven ETFs had a total of more than USD3.6bn in assets under management as of December. On January 2, the SEC also declared effective the registration statement for Market Vectors Coal and Gaming ETFs.