EUROPE – Citing demand from European, and especially German, institutions, US-based stock exchange operator Nasdaq has launched a European-specific exchange traded fund based on the Nasdaq 100 Index.
The Nasdaq 100 European Tracker was launched today under the EQQQ symbol. It is designed to be similar to the existing QQQ offering in the US .
Exchange traded funds are funds that are exchange-listed and can be traded like stocks.
John Jacobs, Nasdaq’s chief executive of financial products, told a news briefing that there was strong institutional demand for such a product, from Germany in particular. He expected some European institutional demand for QQQ to shift to its new European sibling.
Jacobs said the exchange has no time frame in mind for the success of the product nor targets for its eventual size.
Already 20% of QQQ use is by European institutions, he said. Initial authorised participants include Goldman Sachs, Merrill Lynch, Lehman brothers and Madoff Securities.
The EQQQ is euro-denominated and compliant with European Undertakings for Collective Investment in Transferable Securities, or UCITS, rules. It is registered with Ireland’s central bank and is authorised as a fund in the UK, Ireland and Belgium. Expenses for the product are limited at 20 basis points a year.
The EQQQ is based on the Nasdaq 100 Index and not the more widely known Nasdaq Composite because the 100 already has several derivatives based on it, Jacobs said.