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Eco Investor June 2015 Unlisted Companies First ETF for YieldCosThe first exchange traded fund (ETF) to provide investors with access to yieldcos has been launched by Global X Funds, a New York-based provider of ETFs. The Global X YieldCo Index ETF (Nasdaq: YLCO) aims to provide investment results that generally correspond to the price and yield performance, before fees and expenses, of the Indxx Global YieldCo Index. The Global X YieldCo Index ETF has 20 yieldcos and its holdings have a total market value of over US$1.5 million. These are in the US (56.4 per cent of assets), UK (23.3 per cent), Canada (15.8 per cent) and Spain (4.5 per cent). The EFT launched on 27 May. It has 100,000 shares with a net asset value of US$15.27 each. Its total management fee is 0.65 per cent, and it pays quarterly distributions. The Underlying Index comprises listed companies with operating assets that produce defined cash flows, as well as companies that have announced plans to spin-off a yieldco in an initial public offering. Global X said the market capitalization for the yieldco industry is currently US$39 billion. With 11 announced IPOs in the pipeline, it has become an increasingly popular vehicle for energy firms. "Yieldcos exhibit three key investment characteristics many investors have been looking for: high current income, lower volatility, and the potential for dividend growth," said Jay Jacobs, research analyst at Global X Funds. Global X has over 40 funds available across US and foreign exchanges, and is one of the fastest growing issuers of ETFs.
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