Despite what you may have read, Guggenheim did not launch any new ETFs last week. You can safely ignore the headline in the Guggenheim press release. What really happened is buried deep within that press releasewhose headline is totally wrong: as of June 1, 2011, some already-existing ETFs received new names, new objectives, and deceptively higher expense ratios.<\/p>\n
Claymore U.S. Capital Markets Bond ETF (USB)<\/strong>, was launched more than three years ago, only attracted $5.3 million in assets, traded rarely, and became a regular member of ETF Deathwatch<\/a>. Rather than admit failure by closing USB, Guggenheim has given it a new name, new ticker symbol, and new objective. The CUSIP and the 3-year track record did not change. This ETF has been repackaged as Guggenheim Enhanced Core Bond ETF (GIY)<\/strong>.<\/p>\n Claymore U.S. Capital Markets Micro-Term Fixed Income ETF (ULQ)<\/strong> had a similar story, except that it attracted nearly $20 million in assets. On 6\/1\/11, ULQ morphed into Guggenheim Ultra-Short Bond ETF (GSY)<\/strong>.<\/p>\n I\u2019ll say it again so we are all perfectly clear: GIY and GSY are not new ETFs. They are Extreme Makeovers of previously-launched products. ETF sponsor Claymore pioneered this process in July 2009 when Claymore\/Great Companies Large-Cap Growth Index ETF (XGC) mysteriously became the Claymore\/BNY Mellon International Small Cap LDRs ETF (XGC)<\/a>. I highly suggest clicking the link for some background.<\/p>\n Here the plot thickens. Around the same time XGC changed its stripes, Claymore was acquired by Guggenheim but continued operating under the Claymore name. I do not know for a fact that the sponsor\u2019s ownership change had anything to do with the Extreme Makeover of XGC, but the timing was certainly convenient.<\/p>\n In any case, in August 2010 Claymore\/Guggenheim did it again, transforming Claymore\/Sabrient Stealth ETF (STH) into Claymore Wilshire Micro-Cap ETF (WMCR)<\/a>. I contacted Claymore at the time to ask for an explanation. I was told that they chose the cosmetic surgery option because of the \u201ccritical mass\u201d behind STH and the \u201ccost benefits\u201d of not having to close one fund and open another.<\/p>\n