NYSE Euronext has launched an unusual ETN. The Claymore CEF Index-Linked GS ConnectSM ETN (NYSE: GCE) began trading on the NYSE today. This is not a typical ETF (or actually an exchange traded notes offering) because this one tracks an index that is comprised of Closed-End funds.
Linked to the Claymore CEF Index, this ETN provides investors with an opportunity to track a portfolio of liquid Closed End Funds listed in the U.S. The NYSE also has not demanded exclusivity here on this one. Out of the current 75 constituents, 68 are listed with NYSE Group.
As a reminder, closed-end funds are much older than ETF’s. They also trade intraday just like an ETF or like a stock rather than an open-ended "five letter ticker" mutual fund. What is different is that closed-end funds trade at a premium or discount to the net asset values, so that is one more added feature to take into consideration.
Jon C. Ogg
December 10, 2007
Jon Ogg can be reached at [email protected]; he does not own securities in the companies he covers.
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