New Silver Miners and Copper Miners ETFs start trading in New York

Two new index-based specialist commodity related ETFs have been launched in New York by Global X - based on Silver miners and Copper miners.

Author: Lawrence Williams
Posted: Tuesday , 20 Apr 2010

LONDON -

Global X Funds, a New York-based provider of Exchange Traded Funds, has launched the Global X Silver Miners ETF (ticker: SIL) and Global X Copper Miners ETF (ticker: COPX), trading on ARCA. SIL and COPX have a 0.65% expense ratio.

The Global X Silver Miners ETF is said to be the only ETF in the world targeting silver mining companies. It tracks the Solactive Global Silver Miners Index, comprised of the largest and most liquid silver mining companies in the world. The majority of holdings are Canadian based companies but also include companies based in the US, Mexico, Peru, and Russia. As of March 31, 2010, the largest index components were Fresnillo, Industrias Penoles, Silver Wheaton, and Pan American Silver.

Because SIL invests in silver mining companies, it provides a differentiated investment profile to investing in physical silver.

The Global X Copper Miners ETF tracks the Solactive Global Copper Miners Index, comprised of the largest and most liquid copper mining companies in the world. COPX components are based in Canada, Australia, UK, US, Mexico, China, Poland, Switzerland, and South Africa. As of March 31, 2010, the largest index components were Freeport-McMoran, Xstrata, Grupo Mexico, and Southern Copper.

"SIL and COPX provide investors with efficient and targeted exposure to silver and copper mining companies, respectively. Both metals are essential for the global economy and may see growing demand as the economic recovery continues," said Bruno del Ama, CEO of Global X Funds.

The Solactive indexes are maintained by German company Structured Solutions AG and were built up by Structured Solutions in conjunction with the Stuttgart Stock Exchange - Germany's second largest . Structured Solutions acquired the whole index business in an agreement with the Stuttgart Exchange last December.

At the heart of that deal with the Stuttgart Exchange lies the purchase by Structured Solutions of the S-BOX index family. Since mid-2006, under the name S-BOX, the companies have collaborated in the development of over 110 indices. These are now used by issuers in Europe, Asia and North America as underlyings for their ETFs, certificates and other derivatives. The joint index business also includes around 25 other indices outside the S-BOX portfolio which up to now have been calculated by the companies acting as independent service providers. Currently, over EUR 1 billion of assets are linked to indices operated by the former partners.

In the U.S. Funds based on Structured Solutions other indexes are already offered by Global X Funds and Van Eck.

The ETFs are being launched into a fairly crowded space and it remains to be seen how well they do. If they take off then Global X has two more structured ETFs waiting in the wings - a Global Platinum Miners ETF and a Global Gold Miners ETF - also based on indexes from Structured Solutions. The latter even has a lithium based index so it may not be too long before someone seizes on this one to launch an investment product as well.

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