HealthShares: New ETF's Trading (JAN 23, 2007)

New healthcare ETF’s are hitting the market.  XShares Advisors LLC, creator of the HealthShares(TM) family of ETF’s, has launched several new healthcare related ETF’s.  Youcan’t really call an ETF launch an IPO, although these are defintely not the run of th mill ETF’s.  You can visit the Healthsharesinc website for more information.Each Vertical tracks a group of large, mid and small-cap stocks that addresses a distinct sub-segment of healthcare, such as the diagnosis and treatment of specific therapeutic areas (cardiology, cancer, infectious disease, etc.) and the development of medical devices (orthopedic repair, cardio devices, etc.). 

The new HealthShares(TM) family of funds includes five sub-sector ETFs:
HealthShares Cardio Devices ETF (HHE)
HealthShares Diagnostics ETF (HHD)
HealthShares Emerging Cancer ETF (HHJ)
HealthShares Enabling Technologies ETF (HHV)
HealthShares Patient Care Services ETF (HHB)

Each HealthShares(TM) ETF is comprised of 22-25 stocks and tracks its proprietary intellectual model developed by XShares. Each Index composition calculation is administered independently by Standard & Poor’s (S&P). The specialist for these HealthShares(TM) ETFs is Goldman Sachs and Bank of New York is acting as transfer agent for the HealthShares(TM) Exchange Traded Funds.

We’ll follow up later with better lists of underlying stocks in each, but the CEO of XShares on CNBC said that many of these were screening out the stable behemoths to focus on the growth aspects of the sector.  Here is a link to the methodologies of the underlying index criteria for each stock in the group, although it does not name each stock per se.  They have 20 different indexes and the ones that do not ETF’s are scheduled to have ETF’s soon.  These definitely seem different than many other more basic ETF’s.

Jon C. Ogg
January 23, 2007