New Pharma ETN (DRGS) Hits The Market
RBS rolled out its fifth ETN this week, debuting a product that offers exposure to the world’s largest pharmaceutical firms. The new Global Big Pharma ETN (DRGS) will seek to replicate the NYSE Arca Equal Weighted Pharmaceutical Total Return Index, a benchmark that consists of equal allocations to about 16 different companies involved in various phases of development, production and marketing of pharmaceuticals. Under The Hood Half of the underlying portfolio consists of U.S. companies, with the other 50% of the index split between the UK (3 companies), Switzerland, Denmark, France, Israel, and Canada (one company each). The components are equal-weighted, meaning that the allocation to each is approximately equivalent upon rebalancing. Equal-weighted indexes have become increasingly popular as the underlying for exchange-traded products, as many investors have embraced this methodology as an alternative to the potentially inefficient–but still dominant–market capitalization weighting. Because equal weighting breaks the link between index [...] Click here to read the original article on ETFdb.com. Related Posts: The Pharma Four: Similar ETFs, Different Returns Return of Swine Flu: Pharma ETFs In Focus Will Obamacare Put Healthcare ETFs On Life Support? ETF Insider: Equities Poised To Pop Pharma ETFs Rise on Swine Flu Pandemic News
RBS rolled out its fifth ETN this week, debuting a product that offers exposure to the world’s largest pharmaceutical firms. The new Global Big Pharma ETN (DRGS) will seek to replicate the NYSE Arca Equal Weighted Pharmaceutical Total Return Index, a benchmark that consists of equal allocations to about 16 different companies involved in various phases of development, production and marketing of pharmaceuticals. Under The Hood Half of the underlying portfolio consists of U.S. companies, with the other 50% of the index split between the UK (3 companies), Switzerland, Denmark, France, Israel, and Canada (one company each). The components are equal-weighted, meaning that the allocation to each is approximately equivalent upon rebalancing. Equal-weighted indexes have become increasingly popular as the underlying for exchange-traded products, as many investors have embraced this methodology as an alternative to the potentially inefficient–but still dominant–market capitalization weighting. Because equal weighting breaks the link between index [...]

Click here to read the original article on ETFdb.com.

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