ProFund Registers for ETF Series

June 5, 2002 (PLANSPONSOR.com) - ProFund Advisors filed a registration statement with the Securities and Exchange Commission (SEC) for a new series of exchange-traded funds (ETFs).

Pending SEC approval, the funds would be the first ETFs to offer investors leveraged or short exposure to index benchmarks.
 
Each of the new ETFs will seek daily investment results, before fees and expenses, which correspond to the daily performance of a specified benchmark.

Bulls and Bears

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The series consists of four bullish funds and four bearish ones. The former, designed to profit when their index rises and provide twice the daily performance of their benchmarks, are:

  • Ultra500, which tracks the S&P 500
  • Ultra100, which follows Nasdaq-100 Index
  • Ultra30, which tracks the Dow Jones Industrial Average, and
  • Ultra400, which shadows the S&P MidCap 400

The remaining four funds, seeking to profit when the specified index declines and provide double the inverse of the daily performance of the index, are:

  • UltraShort500, which corresponds with the S&P 500
  • UltraShort100, which moves with the Nasdaq-100
  • UltraShort30, which follows the Dow Jones Industrial Average,
  • UltraShort400, which tracks the S&P MidCap 400

Red Tape

In addition to the registration statement, ProFund Advisors applied to the SEC for exemption from several provisions of the Investment Company Act of 1940. The offering of the ETFs managed by ProFund Advisors is contingent upon this approval, and the SEC declaring the registration statement effective.

While index-based ETFs have been available in the US market since 1992, according to a release from the company, the ETFs managed by ProFund would be the first with an objective other than that of approximating the performance of a specified index.

Read more about  Black Box: Exchange Traded Funds

SURVEY SAYS: Advice

May 17, 2001 - Yesterday we noted the dilemma of plan sponsors and providers alike -- why don't participants -- at least large numbers of them -- take advantage of investment advice? Realizing that the reasons can be as diverse as the individual participants themselves, our readers were --as usual --most generous in the response.

Nearly 22% chose a category we didn’t even offer (and we provided EIGHT), which we have summed up as either too lazy and/or not enough time to plan for retirement. Granted, those can be very different motivations, but overall the sense was that individual participants are not making –or taking — the time to attend to this very important area.

A close second opinion (19%) suggested that participants don’t know HOW to use online investment advice. However, we should also note that an number of readers suggested that this was not because they hadn’t been shown how — in some cases multiple times.

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Just behind was 18% who felt that when it comes to investment advice, people were typically going to be more comfortable dealing with people –people they trusted, rather than relying on online tools.

A surprisingly large 14.5% opined that participants weren’t using advice because they didn’t know they had access to advice, and more than 10% said that participants really didn’t have access to advice, either because their employer didn’t offer it, or because the participant lacked convenient access to the Internet.

Nearly 8% said the cost was too high, 5% said it was because participants didn’t think they needed advice and the remaining (roughly 4%) said that participants had been paralyzed with too many choices (another “original” option).

EDITOR’S NOTE: Each week we are treated to a large number of thoughtful, insightful — and occasionally entertaining –responses. We try to share some of these with you most weeks, but this meager space wouldn’t begin to provide a true sense of this week’s contributions. But, thanks to the Web, we are able to post a large number of those responses for your enjoyment and enlightenment (unattributed to protect the “innocent”). You can check them out at http://www.plansponsor.com/content/magazine/may2001advicesurvey .

You’ll no doubt be happy to know that the cover story in the May issue of PLAN SPONSOR, “Filling the Seats”, focuses exactly on the issue of participant advice. You’ll want to check it out at http://www.plansponsor.com/content/magazine/FillingTheSeats–not to mention the rest of the magazine and a series of items you’ll find ONLY on the web at http://www.plansponsor.com/content/magazine/mayissue .

Thanks again to all who participated in our survey –if today’s survey or the postings inspire you, drop us a note at editors@plansponsor.com

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