barclays

Barclays to Introduce Tech-Heavy ETF in U.K.

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Barclays Global Investors (BGI) announced that it plans to launch a new iShares exchange-traded fund (ETF) similar to U.S. "cubes" (QQQ) in the U.K. John Demaine, Managing Director for Product Development, said BGI has plans "to launch an iShare with a U.K. technology bias some time in October." The new ETF will trade on the London Stock Exchange (LSE).

"Cubes" are a type of exchange-traded fund that track the technology-dominated Nasdaq 100 Index and are traded on the American Stock Exchange (AMEX). According to AMEX, QQQ has $12,471,575,000 in net assets, as of 9/21/2000. BGI believes it can replicate the success of U.S. "cubes" in the U.K. with an ETF that has heavy stock holdings in the U.K technology sector.

This most recent announcement is part of a flurry of activity this week on the international ETF scene, with State Street Global Advisors, European Exchange-Traded Fund Company, and others announcing plans to launch ETFs throughout Europe (check out our recent articles).

"We're in the evolutionary phase of what will become a revolution in how people invest," Demaine was quoted as saying in a recent Bloomberg.com article. "People will want quick access to sectors, as opposed to always predicting which individual stocks are going to shoot the lights out."

Barclays has agreed to sell its funds through Barclays Stockbrokers, Commerzbank AG's Comdirect Bank AG, and other brokers, Demaine also told Bloomberg.com.

Demaine also spoke to an issue that is creating a buzz among investors and will probably be the topic of many discussions at the upcoming Exchange-Traded Fund & Index Share Forum in New York: Are ETFs a challenge to the future of index funds?

Although we think it's unlikely, Demaine had this to say: "I'm not saying there won't be a place for index funds, but the people that run those funds will need to show they are adding value."

This latest announcement is one of many that will follow later this year, as Barclays has plans to launch several ETFs throughout the globe in the upcoming months.