Emerging Global Advisors (EGA) has launched the EGShares Blue Chip ETF (BCHP), an exchange-traded fund providing exposure to 30 developed market (DM) companies with measurable, meaningful and growing revenue in their emerging market (EM) operations.
“DM multinationals are often used to invest indirectly in emerging markets; however, the exposure can be limited by the quantity or quality of the companies’ emerging markets business,” says Marten Hoekstra, CEO of EGA.
“To allow investors to access emerging market revenue from quality multinationals, we applied our index design expertise to BCHP, rigorously screening developed market companies and selecting only those with measurable, meaningful and growing exposure to emerging markets.”
“A large number of developed market companies claim emerging market aspirations, but just 24 per cent of those companies adequately disclose what percentage of their revenue comes from emerging or frontier markets,” adds Edward Kerschner, vice chairman of EGA. “Furthermore, of those companies that do disclose adequately, only two per cent are high quality companies that have meaningful and growing emerging market revenue.”
BCHP, EGA’s first self-indexed ETF, will track the EGAISM Developed Markets Blue Chip EM Access Index, an equally-weighted 30 stock index designed to capture the market performance of quality developed market companies that have measurable, meaningful and growing revenue from emerging markets.
The index consists of common stocks listed on the primary exchanges of developed markets, as well as American Depositary Receipts (ADRs) and Global Depositary Receipts (GDRs) listed on US and European exchanges.
