Data & Research May 21, 2009

Boomers Lose Focus on Debt-Free Retirement, Survey Finds

Consumers are more concerned about short-term security than long-term financial goals, according to a survey sponsored by Securian Financial Group.
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While the survey indicated Americans have found many ways to spend less, it also indicated they are not reducing their debt, according to a release of the results of the 2009 Survey of Financial Values and Debt . Eighty-two percent of respondents are carrying non-mortgage debt, a figure that is virtually undiminished since Securian’s initial survey in 2007.

One-fifth of Boomers who are in debt owe at least $50,000 in non-mortgage debt—that is a 10-point spike from the 2007 survey. Boomers were the only generation in the survey (which included Generations Y, X, and the Silent Generation) to add debt since 2007.

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Three-quarters of non-retirees expecting to retire with debt are concerned about the amount of debt they might carry into retirement.

On a more positive note, only one in five people (22%) polled for the Securian survey applied for credit or non-mortgage loans in the last 12 months, and they were less willing overall to take on debt for cars, vacations, gifts, home improvements, or meals out. They also identified several ways to save money on everyday expenses, and eight out of 10 expressed pride in the ways they have cut back.

Products May 21, 2009

Firm Releases Emerging Market ETFs

Emerging Global Advisors, LLC, has introduced an emerging market sector family of exchange-traded funds (ETFs).
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According to a news release, the Emerging Global Shares (EGS) family of ETFs is based on the Dow Jones Emerging Markets Sector Titans Indexes and is designed to provide institutional investors with exposure to leading emerging market companies across multiple industry sectors.

The news release said the initial funds will focus on Energy and Metals & Mining. All the ETFs will be listed on the NYSE Arca electronic exchange.

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“Our family of ETFs will provide the market access and liquidity to allow institutions to execute trading and investment strategies that have not been previously possible,” said Robert Holderith, chief executive officer at Emerging Global Advisors, in the release.

The initial group of ETFs includes:

  • The EGS Emerging Markets Energy Fund, which seeks to track, before fees and expenses, the performance of the Dow Jones Emerging Markets Oil & Gas Titans 30 Index. The Dow Jones Index includes 30 of the largest emerging markets companies in the oil & gas industry across 13 countries.
  • The EGS Emerging Markets Metals & Mining Fund is designed to track, before fees and expenses, the performance of the Dow Jones Emerging Markets Metals & Mining Titans 30 Index. The Dow Jones Index includes 30 of the largest emerging market companies in the metals and mining sectors across nine countries.

Each ETF has exposure to a diversified mix of countries reducing single-country economic and political risk, an important concern for many emerging markets investors, Emerging Global Advisors said. Components of the underlying indexes have been selected by Dow Jones Indexes based on float-adjusted market capitalization, revenue, and net profits.

The company plans to introduce a total of 10 sector-based emerging markets ETFs based on the modified market cap Dow Jones indexes, as well as products built on a Basic Resources index, and additional composites of multiple indexes.

“Current ETF offerings generally limit investors to country or regional exposure, or require a more general investment in emerging markets,” said Holderith. “We think there will be considerable interest in a family of products that provides diversified emerging market sector exposure in a highly transparent, highly liquid ETF format.”

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