Van Eck Debuts Latin America Bond ETF (BONO)
Thursday, 12 May 2011 00:07

In another ETF industry first, Van Eck announced today the launch of an ETF offering pure play exposure to Latin American debt markets. The Market Vectors LatAm Aggregate Bond ETF (BONO) will seek to replicate the performance of the BofA Merrill Lynch Broad Latin America Bond Index, a benchmark that consists of sovereign and corporate debt securities from Latin American issuers denominated in U.S. dollars, euro, and local currencies.

The underlying index will be market cap weighted, with individual issuer exposure capped at 20% of holdings. Under The Hood BONO includes allocations to several Latin American countries, with Brazil accounting for about 37% of the underlying index. Other countries comprising the benchmark include Mexico (29%), Colombia (12%), Venezuela (7%), and Argentina (4%). Chile, Peru, Panama, Jamaica, and Uruguay are also included. The benchmark is broad in nature, including about 450 individual securities. “Local debt markets in Latin America have been [...]

 

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