WealthNotes Capital Management of Westport, Connecticut has joined the fast-growing exchange-traded notes market with the filing of its first offering, an ETN tracking the performance of the S&P 500 130/30 Total Return Strategy Index that will trade on NYSE Arca. The WealthNotes ETN will be issued by Norway's Eksportfinans.
ETNs are debt securities that have similarities to exchange-traded funds in that both are linked to the performance of reference indices and are traded on major exchanges. However, WealthNotes says that under most market conditions, ETNs exhibit no tracking error with regard to their reference index.
'The S&P 500 130/30 Total Return Strategy Index is a highly sought-after strategy that can most effectively be brought to investors through exchange-traded notes,' says WealthNotes Capital Management chief executive Keith Styrcula.
'We're greatly appreciative that a world-class team of global financial partners has been able to bring this highly anticipated index-linked strategy to investors through our highly-rated issuing partner, Eksportfinans. We expect the launch of this compelling investment will add to the ascendancy of the ETN industry, and the highly positive efficiencies ETNs bring to investors both large and small.'
Tim Eisenhauer, vice-president of Standard & Poor's Index Services, says: 'The S&P 500 130/30 Strategy Total Return Index was designed based in response to market demand for an investment strategy that establishes 30 per cent over- and underweight positions relative to the S&P 500.
'As a first offering by an index provider in the USD100 billion 130/30 strategy space, the S&P 500 130/30 Strategy Index is a framework that provides risk-controlled long/short exposure with the prospect of outperformance in a transparent, cost-efficient format.'