Editor’s note: As of 9/12/11, the Focus ETF model is no longer available on Covestor
The Focus ETF model, managed by Analytic Investment, uses computer algorithms to find market inefficiencies that result in ETF mispricing. Recently, they added several new positions to the model. The first that we are going to look at is iShares MSCI Thailand Investable Market Index Fund (THD), a fund that attempts to mirror the performance of the MSCI Thailand Investable Market. In order to do so, 90 percent of the fund’s underlying assets are invested in securities that are on the index. On October 18th the fund was trading at a premium to NAV.
The next position added to the model was iShares MSCI Chile Investable Market Index Fund (ECH) which attempts to mirrors the performance of the MSCI Chile Investable Market index by investing at least 90 percent of the fund’s assets in securities or ADRs that are on the index. On October 18th the fund was trading at a premium to NAV.
The third ETF added to the model is Vanguard Telecommunication Services ETF (VOX). VOX looks to mirror MSCI U.S. Investable Market Telecommunication Services 25/50 index, the benchmark index for telecommunications services stocks’ investment returns. The underlying assets of the index are comprised of U.S. companies in the telecommunications service sector. On October 18th VOX was trading at a discount to NAV.
The last position added to Focus ETF that we are going to look at is Global X China Consumer (CHIQ). CHIQ is an ETF that attempts to mirror the performance of the Solactive China Consumer index. Generally, CHIQ invests 80 percent of its assets in securities on the index and 20 percent in swaps, options and other derivatives and investments that will help ensure performance. On October 18th the fund was trading at a premium to NAV.
