Invesco PowerShares waives fees to 'help to ease' investors' transitions into new funds

By Aleesia Forni

Columbus, Ohio, Nov. 4 - Invesco PowerShares Capital Management LLC plans to waive the unitary fee for its four new funds and believes these new ETFs are "certainly something we think will be attractive to the investment community," said Taylor Ames of Invesco PowerShares' product strategy and research group at Invesco PowerShares.

"The reason why we waived the fee was to help anyone who wanted to move into these ETFs, it helps to ease their transition into these new funds," Ames said.

Invesco PowerShares obtained the KBW Bank index, the KBW Capital Markets index, the KBW Insurance index and the KBW Regional Banking index from State Street as part of an exclusive licensing agreement.

"We were made aware that these four KBW indexes were available and jumped at the opportunity to become KBW's exclusive index licensee," Ames told Prospect News.

"We are proud to have partnered with KBW in the past, and believe in their research and their index methodologies."

Ames said the first attraction to these specific indexes was the name behind them.

"KBW is honestly an industry leader when it comes to the financial sector in terms of research and analysis," Ames said

"I think what helps make them unique is it really has KBW's footprint on them."

Despite recent economic conditions, the company felt the need to "jump on" these indexes immediately.

"It's never going to be the perfect time to launch a fund," Ames said. "Rarely do you launch a fund at the perfect time.

"We believe that we needed to launch these as soon as possible simply because these indexes were available."

Hedge for institutions

The company plans to market these funds to both retail and institutional investors.

"ETFs really play to the entire market," Ames said "However specifically with these, I think the first place we will have to look is within the institutional space."

"We believe from what we've seen, a lot of institutions will use these indexes and these ETFs as a way to hedge their financial exposure."

Ames continued to say that there is "a lot of short interest that exists on these ETFs that were previously based upon these KBW indexes, and most of the time, short interest that is out there generally comes from the institutional space."

The Wheaton, Ill.-based company believes retail investors and advisors will look to use these ETFs as "part of their way to build out a core portfolio."

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