LISLE, Ill.--(BUSINESS WIRE)--Guggenheim Funds Distributors, Inc. announced the launch of the Guggenheim ABC High Dividend ETF (NYSE Arca: ABCS). The new offering from Guggenheim will seek to replicate the BNY Mellon ABC Index (the “Index”) by providing investors with exposure to high-yielding mature companies from the commodity-rich countries of Australia, Brazil and Canada.
“The global supply of commodity and natural resources is expected to become further constrained such that it will be unlikely to keep pace with global population growth,” explained Scott Minerd, Chief Investment Officer, Guggenheim Partners. “Australia, Brazil and Canada are uniquely positioned as a result of vast commodity deposits. These global supply and demand dynamics are likely to place upward pressure on natural resources and commodity prices, thereby leading to attractive investment opportunities.”
Mr. Minerd believes having access to higher-yielding companies from commodity-rich Australia, Brazil and Canada offers investors a high level of dividend income potential. During inflationary periods in commodity-linked economies, many companies—not just energy and materials producers—tend to flourish as overall profits and employment rise with their country’s export sector.
“The introduction of Guggenheim ABC High Dividend ETF represents another step in the growth of our comprehensive product range,” commented Steve Baffico, Senior Managing Director, Guggenheim Funds Distributors, Inc. “Our products are built around themes in which Guggenheim has strong conviction.”
The BNY Mellon ABC Index universe includes US exchange-listed ADRs of companies from Australia and Brazil and locally-listed companies in Australia and Canada, which meet the follow criteria: minimum one year of trading, minimum float market capitalization of $200 million, and minimum three-month daily average trading volume of $1 million. From this universe the 10 highest dividend yielding companies, where possible, are selected from each country for a total of 30 companies in the BNY Mellon ABC Index. Passive foreign investment companies are excluded based upon the best information available. As of May 31, 2011, the Index yield was 5.2%.*
For more information on the Guggenheim ABC High Dividend ETF, click the hyperlink above or call 800-345-7999.
Guggenheim Funds Distributors, Inc.
Guggenheim Funds offers strategic investment solutions for financial advisors and their valued clients. As an innovator in exchange-traded funds (ETFs), unit investment trusts (UITs) and closed-end funds (CEFs), Guggenheim Funds often leads its peers with creative investment strategy solutions. Guggenheim Funds and its affiliates provide supervision, management or servicing of assets with a commitment to consistently delivering exceptional service. Guggenheim Funds is a subsidiary of Guggenheim Partners, LLC, and a global, diversified financial services firm with more than $100 billion in assets under supervision. Guggenheim Partners, through its affiliates, provides investment management, investment advisory, insurance, investment banking, and capital markets services. The firm is headquartered in Chicago and New York with a global network of offices throughout the United States, Europe, and Asia. Guggenheim Funds Investment Advisors, LLC, an affiliate of Guggenheim Funds Distributors, Inc., serves as the Funds’ investment adviser.
*Source: BNY Mellon. The Fund seeks investment results that correspond generally to the performance, before the Fund’s fees and expenses of an equity index called the BNY Mellon ABC Index. The Fund generally will invest in all of the securities comprising the Index in proportion to their weightings in the Index. However, under various circumstances, it may not be possible or practicable to purchase all of the securities in the Index in those weightings. In those circumstances, the Fund may purchase a sample of the securities in the Index in proportions expected by the Investment Adviser to replicate generally the performance of the Index as a whole. There may also be instances in which the Investment Adviser may choose to overweight another security in the Index or purchase (or sell) securities not in the Index which the Investment Adviser believes are appropriate to substitute for one or more Index components in seeking to accurately track the Index. In addition, from time to time securities are added to or removed from the Index. The Fund may sell securities that are represented in the Index or purchase securities that are not yet represented in the Index in anticipation of their removal from or addition to the Index.
RISK CONSIDERATIONS
Risks Considerations Investors should consider the following risk factors and special considerations associated with investing in the Fund, which may cause you to lose money, including the entire principal amount that you invest. Equity Risk: The value of the securities held by the Fund will fall due to general market and economic conditions, perceptions regarding the industries in which the issuers of securities held by the Fund participate, or factors relating to specific companies in which the Fund invests. Foreign Investment Risk: Investing in non-U.S. issuers, although limited to ADRs, may involve unique risks such as currency, political, and economic risk, as well as less market liquidity, generally greater market volatility and less complete financial information than for U.S. issuers. Risks of investing in each of Australia and Canada include commodity exposure risk, geographic risk and trading partners’ risk. Commodity exposure risk is exposure related to any negative changes in the agricultural or mining industries which could therefore have an adverse impact on the Australian or Canadian economy, as applicable. Geographic risk is the risk that a natural disaster could occur in Australia or Canada, as applicable. Trading partners risk is due to the Australian or Canadian economy, as applicable, being heavily dependent upon trading with its key partners. Any reduction in this trading may cause an adverse impact on the economy in which the Fund invests. Brazil has experienced substantial economic instability resulting from, among other things, periods of very high inflation, persistent structural public sector deficits and significant devaluations of the currency of Brazil, and leading also to a high degree of price volatility in both the Brazilian equity and foreign currency markets. Brazilian companies may also be adversely affected by high interest and unemployment rates, and are particularly sensitive to fluctuations in commodity prices. Concentration Risk: If the Index concentrates in an industry or group of industries the Fund’s investments will be concentrated accordingly. In such event, the value of the Fund’s Shares may rise and fall more than the value of shares of a fund that invests in securities of companies in a broader range of industries. Currently, the Fund is subject to Financial Services Sector Risk and Telecommunication Sector Risk. Therefore, the Fund can be significantly affected by certain economic, competitive and regulatory developments associated with these sectors. Small and Medium-Sized Company Risk: Investing in securities of these companies involves greater risk as their stocks may be more volatile and less liquid than investing in more established companies. These stocks may have returns that vary, sometimes significantly, from the overall stock market. In addition the funds are subject to Non- Correlation Risk, Replication Management Risk, Issuer-Specific Changes, and Non-Diversified Fund Risk. Please read the Fund’s prospectus for more detailed information on these risks and considerations.
“BNY Mellon”, and “BNY Mellon ABC Index ” are service marks of The Bank of New York Mellon Corporation (the “Bank”) and have been licensed for use for certain purposes by the Investment Adviser. The Fund is not sponsored, endorsed, sold or promoted by BNY Mellon (“Licensor”). Licensor makes no representation or warranty, express or implied, regarding the advisability of investing in securities generally or in the Fund particularly or the ability of BNY Mellon ABC Index (“Index”) to track general market performance. Licensor’s only relationship to the Licensee is the licensing of the Index which is determined, composed and calculated by Licensor without regard to the Licensee or the Fund. Licensor has no obligation to take the needs of the Licensee or the owners of the Fund into consideration in determining, composing or calculating the Index. Licensor shall not be liable to any person for any error in the Index nor shall it be under any obligation to advise any person of any error therein. Please refer to the prospectus for a full disclaimer.
Investors should consider the investment objectives, risks, charges and ongoing expenses of any ETF carefully before investing. The prospectus contains this and other relevant information. Investors should read the prospectus carefully before investing. To obtain a prospectus, visit www.guggenheimfunds.com or contact a securities representative or Guggenheim Funds Distributors, Inc. 2455 Corporate West Drive, Lisle, IL 60532, 800-345-7999.
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NOT FDIC - INSURED • NOT BANK - GUARANTEED • MAY LOSE VALUE