Products May 12, 2008

State Street Unveils Two SPDRs

State Street Global Advisors (SSgA), the investment management arm of State Street Corporation, said two SPDR exchange-traded funds (ETFs) will begin trading on the American Stock Exchange Tuesday.
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Developed to provide investors with precise exposure to targeted segments of the international markets, the company said the SPDRs include:

  • SPDR DJ Wilshire Global Real Estate ETF (ticker: RWO): The ETF is based on the Dow Jones Wilshire Global Real Estate Securities Index (RESI). The index includes more than 240 commercial and residential real estate companies domiciled in 23 countries across the globe, including the U.S (the ETF has expense ratio of 0.5%);
  • SPDR S&P International Mid Cap ETF (ticker: MDD) — The index includes more than 850 companies with market capitalizations between $2 and $5 billion domiciled in 25 developed countries outside the U.S. (the ETF has an expense ratio of 0.45%)

“Offering a level of international diversification that has not been readily accessible in the past, the new SPDR S&P International Mid Cap ETF was developed to meet increasing investor demand for more high quality international portfolio management tools,’ said James Ross, Senior Managing Director at State Street. “With the addition of the SPDR DJ Wilshire Global Real Estate ETF, our family of SPDRs ETFs now provides investors with distinct exposure to the domestic, international, and global real estate markets.’

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As of March 31, U.S. assets under management in State Street’s ETFs totaled more than $148.2 billion.

In Practice May 12, 2008

Merrill Lynch Sees Strong Adoption of Roth 401(k)

The Merrill Lynch Retirement Group reported that among the 1,700 plans on its proprietary recordkeeping system, almost 200 (12%) had added a Roth 401(k) option as of the end of March.
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The Roth 401(k) is particularly popular among professional service firms, including medical practices, law firms, and consulting agencies, according to an analysis by Merrill Lynch. The company saw a 21% increase in plans adopting a Roth 401(k) feature in the first quarter of 2008, and 25% of those plans were sponsored by professional service firms.

Merrill Lynch said more than 13,000 participants (6% of those eligible plans offering the option) are contributing to a Roth 401(k) account, which was up 37% in the first quarter of 2008. The company’s total assets in Roth 401(k) accounts are $70 million, with $28 million contributed in the first three months of this year.

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Almost 20% of plans with the Roth 401(k) option have participation rates of 10% or more, and 10% of the plans have participation rates of 20% or more, the company said.

 

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