BIROn - Birkbeck Institutional Research Online

Are ETNs realizing their potential? An empirical investigation of ETNs vs. other exchange-traded products in the precious metals’ space

Thukral, Lovjit and Geman, Hélyette and Wright, C. (2012) Are ETNs realizing their potential? An empirical investigation of ETNs vs. other exchange-traded products in the precious metals’ space. Journal of Index Investing 3 (2), pp. 23-33. ISSN 2154-7238.

Full text not available from this repository.
Official URL: http://dx.doi.org/10.3905/jii.2012.3.2.023

Abstract

Within the precious metals space, we outline and empirically investigate three potential advantages that ETNs may have relative to other exchange traded products such as ETFs. First, ETNs may be able to offer investors access to a wider array of assets, commodities, currencies and indices with a greater variety of leverage ratios. We find that ETNs do, in fact, offer investors a much greater variety of leverage ratios in the precious metals space compared to other exchange traded products. Second, ETNs may be able to offer investors lower annual expenses than comparable ETFs or other similar exchange traded products. We are unable to statistically corroborate this notion. We do, however, note that some exchange traded products charge non-trivial fees (upwards of 3.74%) to investors that are not included in the annual expense fee, whereas ETNs assess no such implicit fees. Third, ETNs may enjoy greater price efficiency owing to the absence of tracking error. We find no empirical evidence supporting this possibility.

Item Type: Article
School or Research Centre: Birkbeck Schools and Research Centres > School of Business, Economics & Informatics > Economics, Mathematics and Statistics
Depositing User: Mr Lovjit Thukral
Date Deposited: 04 Sep 2012 08:10
Last Modified: 13 Jun 2013 08:52
URI: http://eprints.bbk.ac.uk/id/eprint/5047

Archive Staff Only (login required)

Edit/View Item Edit/View Item