Emerging Global Advisors (EGA) today announced the launch of the EGShares Blue Chip ETF (NYSE Arca:BCHP), an exchange-traded fund (ETF) designed to provide investors with exposure to a select group of 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” said 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% of those companies adequately disclose what percentage of their revenue comes from emerging or frontier markets,” said Edward Kerschner, Vice Chairman of EGA. “Furthermore, of those companies that do disclose adequately, only 2% are high quality companies that have meaningful and growing emerging market revenue.”1
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 U.S. & European exchanges.
“The fact is that some developed market companies do offer meaningful exposure to emerging market revenues—but only a select few,” said Robert Holderith, President of EGA. “While research shows that only 14% of the S&P 500’s aggregate revenues come from emerging markets2, companies in the EGAISM Developed Markets Blue Chip EM Access Index on average earn 47% of their revenue from emerging markets.”
For more information on BCHP, please visit egshares.com/BCHP.
About Emerging Global Advisors (EGA)
Emerging Global Advisors (EGA) provides investors and institutions with the necessary tools to implement similar investment strategies in emerging markets as they do in developed markets. Our lineup of funds, including our EGShares exchange-traded funds (ETF) offering, enable investors to allocate not merely to, but also within, emerging markets through core equity, thematic, dividend and fixed income funds. These portfolio construction tools allow more accurate targeting of emerging market investment opportunities. For more information, please visit egshares.com.
About EGA Indices (EGAI)
EGA Indices (EGAI), a separate group within EGA, develops intelligent indices for emerging market exposure.
EGAISM Developed Markets Blue Chip EM Access Index Components | |||
As of 4/22/2014 | |||
| Component (listed by total market cap) | Weighting | ||
| QUALCOMM Incorporated | 3.33% | ||
| Rio Tinto plc | 3.33% | ||
| Anheuser-Busch Inbev Sa | 3.33% | ||
| Diageo plc | 3.33% | ||
| Colgate-Palmolive Company | 3.33% | ||
| Las Vegas Sands Corp. | 3.33% | ||
| Glencore Xstrata plc | 3.33% | ||
| Compagnie Financiere Richemont SA | 3.33% | ||
| SABMiller plc | 3.33% | ||
| YUM! Brands, Inc. | 3.33% | ||
| Swatch Group Ltd. Bearer | 3.33% | ||
| Southern Copper Corporation | 3.33% | ||
| Mosaic Company | 3.33% | ||
| Wynn Resorts, Limited | 3.33% | ||
| Old Mutual plc | 3.33% | ||
| Telenor ASA | 3.33% | ||
| Fluor Corporation | 3.33% | ||
| Kansas City Southern | 3.33% | ||
| Mitsubishi Motors Corporation | 3.33% | ||
| Millicom International Cellular SA Swedish DR | 3.33% | ||
| Uni-President Enterprises Corp. | 3.33% | ||
| Skyworks Solutions, Inc. | 3.33% | ||
| Tenaris S.A. | 3.33% | ||
| Asustek Computer Inc. | 3.33% | ||
| Distribuidora Internacional de Alimentacion SA | 3.33% | ||
| Seek Limited | 3.33% | ||
| Finning International Inc. | 3.33% | ||
| Pacific Rubiales Energy Corp. | 3.33% | ||
| Mapfre SA | 3.33% | ||
| A. O. Smith Corporation | 3.33% | ||
Components and weightings are subject to change.
Important Disclosures
Investors should carefully consider the investment objectives, risks, charges and expenses of the Fund before investing. To obtain a prospectus containing this and other important information, please call +1 888 800 4347 or visit egshares.com to view or download a prospectus. Read the prospectus carefully before investing.
The EGShares Blue Chip ETF seeks investment results that correspond (before fees and expenses) to the price and yield performance of the EGAI Developed Markets Blue Chip EM Access Index. This Fund is non-diversified and, as a result, may have greater volatility than diversified-funds. This Fund will concentrate its investment in issuers of one or more particular industries to the same extent that the underlying index. Concentration risk results from maintaining exposure to issuers conducting business in a specific industry. In certain circumstances, the Fund might not be able to dispose of certain holdings quickly or at prices that represent true market value preventing them from tracking the underlying index. As an ETF, fund shares are not individually redeemable securities. There is no assurance that an active trading market for fund shares will develop or be maintained.
Emerging market investments involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles, from economic or political instability in other nations or increased volatility and lower trading volume. Mid-cap companies generally will have greater volatility in price than the stocks of large companies due to limited product lines or resources, or a dependency upon a particular market niche.
S&P 500 Index is a broad-based measure of domestic stock market performance. One cannot invest directly in an index.
The content of this document is presented for general information purposes only. Nothing contained herein should be considered a recommendation or advice to purchase or sell any security. While the information and statistical data contained herein are based on sources believed to be reliable, we do not represent that it is accurate and it should not be relied on as such or be the basis for an investment decision. The statements and opinions expressed are those of Emerging Global Advisors, LLC and are as of the date of this document. All information is historical and not indicative of future results, and subject to change. This document may include estimates, projections and other “forward-looking statements. Due to numerous factors, actual events may differ substantially from those presented. Emerging Global Advisors, LLC assumes no duty to update any such statements. Past performance is no guarantee of future results.
ETF shares are not individually redeemed and owners of the shares may acquire those shares from the ETF and tender those shares for redemption to the ETF in Creation Units only, typically consisting of aggregations of 50,000 shares.
EGShares Funds are distributed by ALPS Distributors, Inc.
Marten Hoekstra, Robert Holderith and Edward Kerschner are registered representatives of ALPS Distributors, Inc.
© Copyright 2014 Emerging Global Advisors, LLC - All Rights Reserved. All rights reserved. EGSharesSM is a service mark of Emerging Global Advisors, LLC. All other trademarks, service marks or registered trademarks are the property of their respective owners.
EGS001852 | Expiration Date 4/23/2015
1 , 2 EGA, “The Best of Both Worlds: Developed market companies benefitting from emerging market growth,” 2014.
Contacts:
Bill Fallon, 212-925-6900
bfallon@keatingco.com
