Source, a UK-based ETP provider, has partnered with Japanese investment bank Nomura to launch a new private-equity ETF.
The new ETF, developed by Nomura, is designed to match the returns of investing in private equity buyout funds through exposure to listed, public-market instruments.
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The Source Nomura Modelled PERI UCITS ETF (PERI) will be listed on the London Stock Exchange and will track the Nomura QES Modelled Private Equity Returns Index (PERI).
The ETF has a lower minimum investment and can be bought and sold on exchange throughout the trading day with one share worth around US$12,000 (£7,429) at launch.
The ETF will have an annual management fee of 0.3%, with an index fee of 1% per annum plus implementation costs, included in the index calculation.
The fund will trade in USD with implementation costs of 0.05% per annum on notional equity sector transactions and 0.40% per annum on the portion of the index allocated to equity sectors.
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By GlobalDataPERI, launched in December 2012, does not invest in buyout funds directly, but instead targets returns similar to the global buyout fund universe, on a committed capital basis, using a combination of equity sector indices and cash in major currencies.
Matthew Peakman, head of fund derivatives trading at Nomura, said: "The new ETF should make private equity investing more accessible."
Ted Hood, CEO of Source, said: "For many investors, private equity is interesting but inaccessible. This product is the first to provide exposure to PERI – an accessible alternative to private equity – in a robust, transparent ETF wrapper."
