The new offerings include a tax-free variable rate demand obligations (VRDO) portfolio, as well as high-quality preferred and U.S. dollar denominated high-yield corporate bond portfolios. These new PowerShares ETF portfolios are expected to begin trading on the American Stock Exchange on November 15.
The anticipated ticker symbols and portfolio names are:
PVI – PowerShares VRDO Tax-Free Weekly Portfolio
PGX – PowerShares Preferred Portfolio
PHB – PowerShares High Yield Corporate Bond Portfolio
According to a press release, product information on PowerShares’ three new fixed-income ETF portfolios are as follows:
The PowerShares VRDO Tax-Free Weekly Portfolio (PVI) seeks to replicate the Thomson Municipal Market Data VRDO Index. This index is designed to track the performance of a pool of short-term, tax-exempt variable rate demand obligations issued by municipalities in the United States. The rules-based index is rebalanced quarterly, and excludes issues subject to alternative minimum tax (AMT).
The PowerShares Preferred Portfolio seeks to replicate the Merrill Lynch Fixed Rate Preferred Securities Index. This index is designed to replicate the total return of a diversified group of high-quality preferred securities. The rules-based index is rebalanced monthly and selects U.S. dollar-dominated, investment-grade preferred securities, with fixed dividend rates.
The PowerShares High Yield Corporate Bond Portfolio seeks to replicate the Wachovia High Yield Bond Index. This index measures potential returns of high-yield corporate bonds rated below investment grade by Moody’s, S&P or Fitch, issued by U.S. or foreign private issuers that are payable in U.S. dollars. The index methodology evaluates securities quarterly using an equal-weighting methodology, and requires the securities have a minimum of five years to maturity, minimum par values and fixed interest rates.
PowerShares Capital Management LLC has a family of over 100 domestic and international exchange-traded funds. With franchise assets of approximately $35 billion, PowerShares ETFs trade on all three U.S. stock exchanges.