Global X, the quickly growing
ETF
issuer known for its unique sector specific products, announced more plans to expand its ETF lineup. The companyreleased information on a proposed Social Media
IndexETF which will track the Solactive Social Media Index. If approved by the SEC, the new fund would be the 36th product for the New York-issuer and would continue the blistering pace of growth that the company has seen so far in 2011. Although a ticker symbol and expense ratio were not released at time of filing, we have highlighted some of the key details from the document below:
The proposed fund's underlying index is designed to reflect the performance of companies involved in the social media industry, including companies that provide social networking, file sharing, and other web-based media applications. The stocks are screened for liquidity and weighted according to modified free-float market capitalization while the index is maintained by Structured Solutions AG. While more information was not released about the index, some information from the Structured Solutions website did offer some more clues. The page detailed several companies that are in the index including LinkedIn, Renren, as well as lesser known firms such as Meetic and Tencent Holdings. It should also be noted that several of the companies on this list are either based in or trade out of international markets, suggesting that this fund could focus on global social networking firms and not just those that are based in the U.S. [also see our Stock Exposure Tool]
Social Media Sector
Social Media has been gaining great popularity over the last few months as many companies in the space have hit the market with very successful IPOs. Arguably the most famous of this period is LinkedIn (NYSE:LNKD), the business-focused networking site for professionals. The company was initially priced at about $45/share but surged in the first day of trading to close to the triple digit level. The stock has seen significant volatility since then but is now trading around $100 once again, representing a decent gain for those who got in at the company's opening price of roughly $85/share.