ROCKVILLE, MD -- 06/12/08 --
Rydex Investments announced that shares of
eight new leveraged and inverse exchange traded funds will begin trading
today on the American Stock Exchange. RydexShares(TM) leveraged and inverse
Select Sector ETFs aim to offer investors magnified and inverse exposure to
the following Select Sector Indices: Energy, Financial, Technology and
Health Care. With more than $25 billion(1) in benchmarked assets, Select
Sectors represent the industry's largest and most liquid indices for sector
investing.
"Financial professionals have shown significant interest in leveraged and
inverse strategies for their potential to help capitalize on directional
market moves or hedge an investment portfolio," says Carl Verboncoeur,
Rydex Investments CEO. "As the pioneer of leveraged and inverse mutual
funds, we are excited to bring new ETFs to the marketplace that offer unique
leveraged and inverse exposure to the most widely traded sector indices."
On a daily basis, Rydex's leveraged Select Sector ETFs aim to magnify their
benchmark exposures by 200%, which allows investors to achieve greater
exposure to an index with less capital. The firm's inverse Select Sector
ETFs seek to move in the opposite direction of their specific benchmarks,
enabling investors to potentially profit during sector downturns. More
convenient than margin accounts or options, the new ETFs offer an easy and
cost-effective way to employ leverage or hedge against specific sector or
stock positions without shorting.
"The Select Sector indices represent various sector components within the
S&P 500," says Edward Lopez, director of ETF strategies at Rydex. "For
those financial professionals who have built portfolio models around the
S&P 500, as well as the Select Sector indices themselves, the new leveraged
and inverse ETFs may provide a useful and convenient way to achieve
directional exposure."
RydexShares(TM) leveraged and inverse Select Sector ETFs complement the
firm's existing lineup of leveraged and inverse ETFs, which provide broad
market exposure to small-, large- and mid-cap indices. At 70 basis points,
Rydex's new sector ETFs also provide a lower-cost alternative for investors
looking for leveraged and inverse sector exposure.
According to Lopez, recent market volatility has given rise to increased
demand for ETFs that enable advisors to short specific segments of the
market or take advantage of sector opportunities by using leveraged
strategies. "The availability of new products combined with increased
interest in leveraged and inverse ETFs calls for education about how these
sophisticated products work, including their potential benefits and risks."
To help educate investors, Rydex continues to build on its ETF
Essentials(TM) program, which explores the compounding effect of using
leverage, among other ETF-related issues. The firm also offers educational
literature and online tools to help investors understand leveraged and
inverse ETFs.
Go Long
Rydex 2x S&P Select Sector Energy ETF (AMEX: REA)
Rydex 2x S&P Select Sector Financial ETF (AMEX: RFL)
Rydex 2x S&P Select Sector Health Care ETF (AMEX: RHM)
Rydex 2x S&P Select Sector Technology ETF (AMEX: RTG)
Go Short
Rydex Inverse 2x S&P Select Sector Energy ETF (AMEX: REC)
Rydex Inverse 2x S&P Select Sector Financial ETF (AMEX: RFN)
Rydex Inverse 2x S&P Select Sector Health Care ETF (AMEX: RHO)
Rydex Inverse 2x S&P Select Sector Technology ETF (AMEX: RTW)
(1) Data source: Morningstar as of March 31, 2008
About Rydex Investments
Rydex Investments continues to drive change in the financial industry by
introducing investment products and services that challenge conventional
thinking, empower investors and provide essential new options for uncertain
market conditions. Rydex manages approximately $16 billion in assets via
nearly 100 mutual funds and exchange traded products.
For more complete information regarding RydexShares(TM), including
management fees and expenses, call 877.RYDEX34 or visit
www.rydexinvestments.com for a prospectus. Investors should carefully
consider the investment objectives, risks, charges and expenses of a fund
before investing. The fund's prospectus contains this and other information
about the fund. Please read the prospectus carefully before you invest or
send money.
RydexShares are subject to risks similar to those of stocks and may not be
suitable for all investors. Investment returns and principal value will
fluctuate so that when shares are redeemed, they may be worth more or less
than original cost. There are no assurances that any Rydex ETF will achieve
its objective and/or strategy.
Investing in leveraged and inverse ETFs involves certain risks, which
include increased volatility due to their use of short sales of securities
and derivatives such as options and futures. The more an ETF invests in
leveraged instruments, the more the leverage will magnify any gains or
losses on those investments. The ETFs are subject to active trading risks
that may increase volatility and impact the funds' ability to achieve their
investment objectives.
Securities are not guaranteed by any bank, are not insured by the FDIC or
any other agency, and involve investment risks, including the possible loss
of the principal amount invested.
"McGraw-Hill®," "Standard & Poor's®" and "S&P®," are trademarks of
The McGraw-Hill Companies, Inc. The stocks included in each Select Sector
Index were selected by a compilation agent. The composition and weightings
of the stocks included in each Select Sector Index can be expected to
differ from any similar S&P 500 sector index that is published by S&P.
Select Sector indices have been licensed for use by Rydex Investments and
its affiliates. Rydex ETFs are not sponsored, endorsed, sold or promoted by
Standard & Poor's and S&P makes no representation regarding the
advisability of investing in the funds. This entity and its affiliates make
no warranties and bear no liability with respect to Rydex Investments.
Rydex Distributors, Inc., an affiliate of Rydex Investments, is the
distributor of Rydex funds.
Contact:
Lori Klash Winkler
301.296.5487
Email Contact
