ProShares, a premier provider of alternative exchange traded funds (ETFs), today announced the launch of the first ETF that provides inverse exposure to U.S. Treasury Inflation-Protected Securities (TIPS).
The ProShares UltraShort TIPS (NYSEArca: TPS) seeks to provide -2x of the daily return of the Barclays Capital U.S. Treasury Inflation Protected Securities (TIPS) Index (Series-L), before fees, expenses and interest income. The ETF lists on NYSE Arca today.
“Fueled by expectations of rising long-term interest rates, our inverse Treasury ProShares have garnered more than $7 billion since launching less than three years ago,” said Michael L. Sapir, Chairman and CEO of ProShare Advisors LLC, ProShares’ investment advisor. “Our new fund, the first inverse TIPS ETF, is a new tool for investors considering hedging against or seeking to benefit from declines in TIPS prices.”
TPS expands the ProShares lineup of geared Treasury ETFs to six. The lineup now includes four funds offering short exposure and two that offer magnified exposure to Barclays Capital U.S. Treasury Indexes.
|New Treasury ETF|
Ultra Short TIPS
Barclays Capital U.S. Treasury Inflation Protected Securities (TIPS) Index (Series-L)
Existing Treasury ETFs
|UltraShort 7-10 Year Treasury||PST||Barclays Capital 7-10 Year U.S. Treasury Index||-2x||NYSE Arca|
|UltraShort 20+ Year Treasury||TBT||Barclays Capital 20+ Year U.S. Treasury Index||-2x||NYSE Arca|
|Short 20+ Year Treasury||TBF||Barclays Capital 20+ Year U.S. Treasury Index||-1x||NYSE Arca|
|Ultra 20+ Year Treasury||UBT||Barclays Capital 20+ Year U.S. Treasury Index||+2x||NYSE Arca|
|Ultra 7-10 Year Treasury||UST||Barclays Capital 7-10 Year U.S. Treasury Index||+2x||NYSE Arca|
*Before fees, expenses and interest income.
ProShares is a premier provider of alternative ETFs, with 115 funds and nearly $24 billion in assets. ProShares offers the largest family of geared (leveraged and inverse) ETFs1. ProShares is part of ProFunds Group, which was founded in 1997 and includes nearly $31 billion in mutual fund and ETF assets2.
Leveraged and inverse ProShares and ProFunds seek returns that are multiples or inverse multiples (e.g., 2x, -2x) of the return of an index or other benchmark (target) for a single day. Due to the compounding of daily returns, leveraged and inverse ProShares’ and ProFunds’ returns over periods other than one day will likely differ in amount and possibly direction from the target return for the same period. Investors should monitor their holdings consistent with their strategies, as frequently as daily. For more on correlation, leverage and other risks, please read the ProShares or ProFunds prospectus.
1 Source: Lipper, based on a worldwide analysis of all of the known providers of funds in these categories. The analysis covered ETFs, ETNs and mutual funds by the number of funds and assets as of 6/30/2010.
2 Number of funds and assets as of 1/01/2011.
Investing involves risk, including the possible loss of principal. ProShares and ProFunds are non-diversified and entail certain risks, including risk associated with the use of derivatives (futures contracts, swap agreements and similar instruments), imperfect benchmark correlation, leverage and market price variance, all of which can increase volatility and decrease performance. Short ProShares and ProFunds should lose money when their benchmarks or indexes rise. Typically, the value of outstanding Treasurys falls when interest rates rise. The value of an inflation-indexed security (such as TIPS) tends to decrease when real interest rates increase, and tends to increase when real interest rates decrease. See the prospectus for a more complete description of risks. There is no guarantee any ProShares ETF or ProFund will achieve its investment objective.
Carefully consider the investment objectives, risks, charges and expenses of ProShares and ProFunds before investing. This and other information can be found in their summary and full prospectuses. Read them carefully before investing. Obtain them at www.proshares.com or www.profunds.com.
The Barclays Capital U.S. Treasury Inflation Protected Securities (TIPS) Index includes all publicly issued, U.S. Treasury inflation-protected securities that have at least one year remaining to maturity, are rated investment grade, and have $250 million or more of outstanding face value. Barclays Capital and Barclays Capital Inc. are trademarks of Barclays Capital Inc. and have been licensed for use by ProShares. ProShares are not sponsored, endorsed, sold, or promoted by Barclays Capital or its affiliates, and they make no representation regarding the advisability of investing in ProShares.
"ProFunds Group" includes ProFunds mutual funds and ProShares ETFs. ProFunds mutual funds are distributed by ProFunds Distributors, Inc. ProShares are distributed by SEI Investments Distribution Co. which is not affiliated with the advisors.
Tucker Hewes, 212-207-9451