Battle of Emerging Market ETFs
Thursday, May 20th, 2010Michael Johnston submits:
As one of the most recent entrants into the ETF industry, South Africa-based Old Mutual faces a tough road to taking market share away from the well-established firms and funds that dominate the industry. Earlier this week, the firm shed some light on its strategy for competing with the first movers in the ETF space, announcing a significant price cut to its most popular ETF. Beginning June 1, the net expense ratio on the GlobalShares FTSE Emerging Markets Fund (GSR) will be cut from 0.35% to 0.25%, making it the cheapest ETF in the emerging markets equities category.
This isn’t the first time Old Mutual has attempted to differentiate its products on the basis of price; when GSR was launched in late 2009, the initial expense was 0.0% – a first in the ETF industry. Of course this offer was for a limited time only, and the cap expired at the end of January.
