Plans for the world's-first U.S.-listed ETF based on the Nikkei 225, Japan's equivalent to the large-cap S&P 500 benchmark, moved forward last week with a regulator filing that discloses the name of the fund and that provides a different name for the advisor behind the new security.
The ETF will be called the Maxis Nikkei 225 Index Fund, and Bedminster, N.J.-based Precidian Funds will serve as advisor, according to a filing with the Securities and Exchange Commission dated June 3. An initial "exemptive relief" filing from last August said NEXT ETFs LLC would be the adviser.
It wasn't immediately clear whether the change in advisor meant that NEXT Investments, an ETF consulting firm also based in Bedminster, N.J., would be changing its name. An official from the company declined to comment, citing regulations that prohibit comments on filings that are still coursing their way through the SEC.
The Nikkei 225 has been the premier index of Japanese stocks for the last 60 years. Many financial products are linked to the Nikkei 225, including investment trusts and index futures. They have been developed and are traded on exchanges worldwide. A number of Nikkei 225 ETFs exist, but they're available only to Japanese investors or those with foreign accounts. Also, they're not denominated in dollars, as the Maxis Nikkei 225 Index Fund will be.
The proposed fund could end up being the Japan equivalent of the SPDR S&P 500 ETF (NYSEArca:SPY), the world's first and largest exchange-traded fund that's now widely used by buy-and-hold investors and day traders alike.
On its website last summer, NEXT said it is launching the planned ETF with Mitsubishi UFJ Asset Management Co. Ltd. and Nikkei Inc. The Nikkei index is sponsored by Nikkei Inc., a Japanese media company that publishes five newspapers and operates online news site, according to the first exemptive relief. Nikkei Inc. focuses on business and economic news and information.
Exemptive relief filings such as the one made by Precidian Funds grant ETF firms exception to sections of the Investment Act of 1940, and are just the first step in the path to launching ETFs. It often takes at least six to 12 months from the date of the initial filing for a company's first ETF to hit the market.
In the new exemptive relief filing dated June 3, Precidian said Foreside Fund Services LLC, a firm incorporated in Delaware but based in Portland, Maine, would be the distributor of the Maxis Nikkei 225 Index Fund.
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