CS ETF (IE) on MSCI USA (USD) | CSUS |
von
Alastair Kellett01.05.2013
Rolle im Portfolio
This fund is best suited as a core building block for a portfolio, providing broad exposure to many of the largest companies in the world’s biggest economy. With over 600 mid- and large-cap constituents, the MSCI USA Index covers more than 80% of the U.S. equity market. It is well diversified by sector and security, with no industry currently accounting for more than 20% of the total, and no individual stock more than 3%. Increasingly, the underlying companies themselves are becoming geographically diversified, getting more and more of their revenue from outside the United States. Over the last 10 years, the MSCI USA Index has exhibited annualised volatility of 14.9%, roughly equivalent to that of the MSCI Europe. During the same period, it has shown a correlation to European equities (in local currencies) of 89% and to emerging markets equities (again, as measured in local currency) of 77%. U.S. equities comprise a large portion of many global equity indices, for example they made up 53.8% of the MSCI World Index at the end of March 2013. So combining this fund with a global product might result in an overweight to U.S. equities. It would therefore work better in conjunction with an EAFE or World ex-U.S. exposure. The fund does not distribute any of the dividends paid by its underlying constituents, instead reinvesting them immediately to maintain full exposure. Therefore, this product may not suit an investor looking for regular investment income. Also important to note is that Credit Suisse has announced an upcoming sale of its ETF business to BlackRock, iShares’ parent company. The transaction is expected to close by the end of the second quarter 2013, and will include all 58 CS ETFs across the Swiss, Irish, and Luxembourg platforms.
Fundamentale Analyse
Though its fortunes have been overshadowed somewhat by the events unfolding in Europe, the United States has continued to show lacklustre progress towards economic recovery. The unemployment rate, while down from its highs, is still stubbornly lofty at 7.7%. GDP advanced by 2.2% in 2012, up from 1.8% in 2011 but still below the roughly 3% pace it has averaged over the last 30 years. One recent bright spot is that the long-anticipated recovery in U.S. housing seems to be taking hold. The S&P/Case Shiller Home Price Index 20-city composite was up 8.1% for the 12 months through the end of January 2013, although it is still down roughly 30% from its 2006 peak. Thanks to a last-minute deal reached by U.S. politicians, much of the immediate impact of the “fiscal cliff” was avoided, although payroll taxes did rise on December 31st, 2012. Still, the impact appears to have been muted, as consumer spending numbers for January and February were stronger than expected. More recently, spending cuts automatically triggered as part of a sequestration began to take hold in March 2013, and could put a significant dent in this year’s economic output. To pick up the stimulus slack, monetary policy has been extremely accommodative since the global financial crisis. The Federal Reserve has lowered short term interest rates to near zero, and tied its policy objectives to job growth by indicating that rates will remain low until the unemployment rate falls to 6.5%. The MSCI USA Index has returned 8.05% per year over the last 10 years, though its five-year tally has been weaker at 5.23% per annum. Like most equity exposures, the index took a drubbing during the 2007-2008 financial crisis, but it has rallied considerably since then as successive rounds of quantitative easing have encouraged investors to move into risky assets. After bottoming out at 9.4 in February 2009, the price-to-earnings ratio of the MSCI USA had climbed to 16.6 at the end of March 2013, above its average since the start of 2007 of 15.1.
Indexkonstruktion
The MSCI USA Index is weighted by free-float-adjusted market capitalisation. It currently contains 604 large- and mid-cap constituents, and covers roughly 85% of the U.S. equity market. Inclusion in the index requires passing screens for minimum total size and free float, trading volume, and length of trading history. The index is formally reviewed on a quarterly basis, although adjustments can be made at any time in the case of a significant corporate action. New size cut-offs are recalculated semi-annually. The ongoing reviews are meant to ensure that eligible new stocks are added to the index, and that existing stocks continue to meet criteria. To control portfolio turnover, buffers are used for existing constituents, so that they are not immediately removed upon falling out of line with any of the index’s entrance criteria. The index is broadly diversified by industry. As of the end of March 2013, the most significant sector exposures were information technology at 18.2% and Financials at 15.7%. Health Care, Consumer Discretionary, Energy, and Consumer Staples all had weights between 10 and 13%. There was limited portfolio concentration, with the top 10 positions accounting for just 17.7% of the total. Top holdings were Apple, Exxon Mobil, and General Electric, at respective weights of 2.8%, 2.8%, and 1.6%. The median market capitalisation of constituents was $11.2 billion.
Fondskonstruktion
The fund uses full physical replication to try to capture the performance of its benchmark, owning-- to the extent possible and efficient--shares in all of the underlying constituents in the same weights as those of the index. In certain circumstances it may also use derivatives to achieve its objectives. The fund is Irish-domiciled and has the U.S. dollar as its base currency. At the time of writing it had assets of $324 million. The fund’s prospectus gives Credit Suisse the flexibility to change the fund’s replication method, to stratified sampling or synthetic, or any combination of the three, according to its discretion. In the case that the fund used swaps for synthetic replication, the counterparty would normally be a member of the Credit Suisse group. Swaps could be funded or unfunded, with the substitute basket or collateral held by the fund’s custodian and marked to market on a daily basis. Dividends paid to the fund by its underlying holdings are immediately reinvested, rather than being distributed to the fund’s investors. This should reduce the cash drag that can result from accumulating dividends. At present, the fund does not engage in any securities lending.
Gebühren
The fund’s total expense ratio (TER) is 0.33%, which ranks as middling among similar funds. Other costs potentially borne by the unitholder but not included in the total expense ratio include transaction costs on the infrequent occasions when the underlying holdings change, and bid-ask spreads and brokerage fees when buy and sell orders are placed for ETF shares.
Alternativen
In addition to the MSCI USA, there are a number of index alternatives for the U.S. equity market, including the S&P 500, the Dow Jones Industrial Average, which is price weighted and more concentrated in its holdings, and the technology-heavy NASDAQ. Many providers offer ETFs tracking the MSCI USA Index, including ComStage, db x-trackers, ETFlab, HSBC, Lyxor, Source, UBS, iShares, and Amundi. Of these, the db x-trackers product is the largest, with assets of $2.1 billion, followed by the UBS fund with assets of $1.6 billion. The fund with the lowest expense ratio is the ComStage product, with a TER of 0.25%.
