Thursday, June 12, 2008

New Exchange-Traded Securities to Track Housing Market

From the press release:
MacroShares Housing Depositor, a subsidiary of MacroMarkets LLC, filed with the Securities and Exchange Commission for exchange-traded securities that will allow investors to invest in the upward and the inverse movement of U.S. home prices. MacroShares Major Metro Housing Up and Down securities will be based on the S&P/Case-Shiller Composite-10 Home Price Index and will allow investors to access this important, but illiquid, asset class. When launched, these revolutionary paired securities will have a ten-year term and will feature a 2x (200%) leverage factor.

MacroMarkets LLC plans to launch the new securities on the NYSE Arca under the ticker symbols:

• UMM – MacroShares Major Metro Housing Up
• DMM – MacroShares Major Metro Housing Down


MacroShares Major Metro Housing will be based on the S&P/Case-Shiller Composite-10 Home Price Index, which is a nationally recognized gauge for U.S. home prices and is followed closely by both institutions and the media. The Composite-10 is a weighted measure of home price changes in the following metropolitan areas:

• Boston
• Chicago
• Denver
• Las Vegas
• Los Angeles
• Miami
• New York
• San Diego
• San Francisco
• Washington, DC
More details can be found in the SEC filing.

Hat tip to the Housing Derivatives blog for finding this.

Follow up: Perhaps Joe Lieberman would like to blame Wall Street speculators for the decline in housing. After all, when financial markets forecast unfortunate events, financial speculation must be the cause—not the effect—of the events.

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