Global X Funds, the New York-based ETF provider known for its commodities and emerging markets funds, launched today the marketâs first ETF to focus solely on Greece, serving up direct access to a country most investors have worked hard to avoid as it sits in the heart of the European sovereign debt crisis.
The Global X FTSE Greece 20 ETF (NYSEArca:GREK) tracks the FTSE/ATHEX 20 Capped Index, which consists of the top 20 companies by market capitalization listed on the Athens Exchange. The fund costs a net expense ratio of 0.69 percent.
Up to now, investors looking to tap into Greek equities could only do so via broader European-focused ETFs such as the $932 million iShares S'P Europe 350 (NYSEArca:IEV) or the $702 million iShares MSCI EMU (NYSEArca:EZU), or even the $6.8 billion Vanguard MSCI European ETF (NYSEArca:VGK). But these fundsâ allocation to Greece is minimal if not negligible.
Greece has seen its economy succumb to the weight of a massive sovereign debt burden. The Athens Stock Exchangeâs market capitalization reached $220 billion in 2007, but has since shed some 90 percent of its value, dropping to $28 billion as of November, Global X said, citing Bloomberg data.
âWhile thereâs no guarantee that the Greek economy will recover to previous levels, current valuations may create an attractive entry point for the long term investor,â the company said in a press release.
âWhether bullish or bearish, this new ETF allows investors to take a viewpoint on the recent news coming out of Greece,â Bruno del Ama, CEO of Global X Funds, added.
The National Bank of Greece, Coca Cola-HBC and the Greek Organisation of Football Prognostics tops the list of GREKâs holdings. From a sector perspective, the fund allocates 35 percent of its portfolio to financials, with industrials coming in second, with a 22 percent share of the basket, and consumer discretionary coming in at 18.5 percent.
GREK is only Global Xâs third Europe-focused ETF, joining a pair of Nordic and Norway funds. The company has some $1.4 billion in assets under management, according to data compiled by IndexUniverse.
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