ProShares Trust launches German Sovereign/Sub-Sovereign ETF

By Toni Weeks

San Diego, Jan. 23 - ProShares Trust announced the Jan. 25 launch of a specialty exchange-traded fund that will focus its investments in Germany, according to an N-1A filing with the Securities and Exchange Commission.

The ProShares German Sovereign/Sub-Sovereign ETF will trade on the NYSE Arca under the symbol "GGOV."

The fund will seek investment results that track the performance of the Markit iBoxx EUR Germany Sovereign and Sub-Sovereign Liquid Index, which seeks to track the performance of fixed-rate debt securities of the Federal Republic of Germany as well as local governments and entities or agencies guaranteed by German government issuers.

To be included in the index, components must be rated investment grade or higher based on an average of ratings issued by Moody's Investors Service, Standard & Poor's and/or Fitch, Inc. Sovereign and sub-sovereign issuers must also have a minimum principal outstanding of €2 billion or €1 billion, respectively.

No issuer included in the index has a weight of more than 24%, and the sum of issuers with weights of 5% or more must total less than 50%. The index is rebalanced quarterly. As of Dec. 30, it was comprised of 33 component securities representing debt of 14 issuers.

Under normal conditions, the fund will invest at least 80% of its total assets in securities of the index. It will also invest in derivatives and other debt securities that, when combined, track the performance of the index.

The portfolio manager will be Alexander Ilyasov, who has been employed by Bethesda, Md.-based ProShare Advisors LLC, the fund's investment adviser, since 2009 as a portfolio manager. Prior to that, he was a portfolio manager from 2006 to 2009 and a portfolio analyst from 2005 to 2006 with World Asset Management.

Annual fund operating expenses include a 0.35% investment advisory fee plus other expenses. ProShare Advisors will waive fees and/or reimburse expenses so that total annual operating expenses will not exceed 0.45% through Jan. 25, 2013.

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