Ossiam, an affiliate of Natixis Global Asset Management, is to list its new ETF, the Ossiam ETF Emerging Markets Minimum Variance NR fund, on the London, Frankfurt, Milan and Paris stock exchanges later this month.
Bruno Poulin, CEO of Ossiam, says: “With the launch of our latest fund, Ossiam is providing an additional solution for investors seeking to build a global equity allocation. This new fund is targeted at investors who want exposure to emerging markets growth as part of their portfolio, but are wary of high volatility and risk. The launch of our latest product continues our strategy of setting the standard for minimum variance ETFs.”
The fund will track a new index initiated by the Ossiam research team, the Ossiam Emerging Markets Minimum Variance Index (Bloomberg: OEMMVNR), calculated and published in real time by S&P1. The index includes a dynamic selection of emerging markets stocks, selected among the 400 most liquid stocks from the S&P IFCI Index. The S&P/IFCI Index is a market capitalisation index which tracks the performance of major companies (over 1 800 stocks and ADR) in 20 emerging countries. Ossiam Emerging Markets Minimum Variance Index is weighted with the intention to minimise the volatility of the total portfolio. On average the volatility of the Ossiam Emerging Markets Minimum Variance index is at least 30% lower than the S&P IFCI index, with a significant reduction in drawdowns.
1 In order to minimize any potential for conflicts caused by the fact that Ossiam determines the weight of the index components at each rebalancing date and acts as asset manager, Ossiam has retained an unaffiliated third party to calculate and publish the index, namely S&P.
2 Based on a backtest. Past volatility data is not a reliable indicator of future volatility. Investors should note that the reduction of the volatility can decrease the potential performance of the fund indexed to the strategy. Due to its exposure to equity markets, the Fund may experience significant volatility. Hence, investors should note that the value of their investment could fall as well as rise and they should accept that there is no guarantee that the underlying methodology of the Index will indeed result in a return above any comparable investment strategy or that they will recover their initial investment. This model assumes reinvestment of net dividends.
The launch brings further scope to Ossiam’s already comprehensive minimum variance product suite, with funds designed to work synergistically to optimize investors’ global allocation while reducing overall portfolio risk.
The new ETF will offer access to a key market segment, emerging markets, with reduced risk and the aim of providing investors with further diversification opportunities following the launch of the Ossiam ETF iSTOXX Europe Minimum Variance NR, Ossiam ETF US Minimum Variance NR and Ossiam ETF FTSE Minimum Variance funds.
The new ETF is distributed and marketed through Natixis Global Asset Management (NGAM) UK Ltd. The funds will be listed on the London, Frankfurt, Milan and Paris stock exchanges beginning in the week commencing 19 March.
Hervé Guinamant, President and CEO of NGAM international distribution, says: “We are launching the latest OSSIAM ETF in a context of growing interest among investors for emerging markets, which have experienced more than USD 14bn of net new assets so far in 2012. This makes the new product an excellent addition to our wide range of specialist investment solutions.”
The fund has a total expense ratio of 0.75% per annum. Regular dividends received on a stock present in the index are reinvested in the index on a net basis.
The fund will be listed on stock exchanges in the following order:
19 March, 2012 on Xetra in Frankfurt
19 March, 2012 on Borsa Italiana in Milan
22 March, 2012 on NYSE Euronext Paris
26 March, 2012 on the London Stock Exchange
