Rockville, Md.-based Rydex Investments is building out a series of exchange-traded funds which reference currencies. The series--launched in December with the Euro Currency Trust--already has about USD840 million under management, mostly in the euro fund. The group has just launched a Mexican peso fund. It hopes to continue growing the range of funds and will also consider approaches from dealers interested in writing notes on the funds.
The firm has already given the go-ahead to such notes on some of its equity funds. Tim Meyer, ETF business manager, said it has not yet been approached regarding the funds but "we expect that we will." The fx funds pay out monthly yield in U.S. dollars and are structured as broker accounts. Meyer said this makes them more appealing to investors whose alternative is to go to the futures market. He noted, for example, several firms created spread plays on its Rydex S&P Equal Weight fund, which references the Standard & Poor's Equal Weight Index, as the index itself does not have listed options.
