Claymore Securities Launches Three New ETFs.Based on Morningstar's Super Sector Indexes Focused on Information, Services and Manufacturing LISLE lisle n. 1. A fine, smooth, tightly twisted thread spun from long-stapled cotton. 2. Fabric knitted of this thread, used especially for hosiery and underwear. , Ill. -- Claymore Securities, Inc. today launched its three newest exchange-traded funds Exchange-traded funds (or ETFs) are Open Ended investment companies that can be traded at any time throughout the course of the day. Typically, ETFs try to replicate a stock market index such as the S&P 500 (e.g. (ETFs) on the New York Stock Exchange New York Stock Exchange (NYSE) World's largest marketplace for securities. The exchange began as an informal meeting of 24 men in 1792 on what is now Wall Street in New York City. Arca, Inc. (NYSE Arca For other uses of "ARCA", see ARCA. NYSE Arca, previously known as ArcaEx, an abbreviation of Archipelago Exchange, is an entirely online securities exchange on which both stocks and options are traded. ). The three new Claymore ETFs license the Morningstar Super Sector Indexes: the Claymore/Morningstar Information Super Sector Index ETF ETF See Exchange Traded Fund. ETF See exchange-traded fund (ETF). (NYSE NYSE See: New York Stock Exchange :MZN), the Claymore/ Morningstar Services Super Sector Index ETF (NYSE:MZO) and the Claymore/Morningstar Manufacturing Super Sector Index ETF (NYSE:MZG MZG Mehrzweckgebaeude ). All three ETFs have an expense cap of 0.40%1. "Investors recognize that sector diversification Sector diversification Constituting of a portfolio of stocks of companies in each major industry group. is important, but the sheer number of sectors may make it difficult for them to track and allocate their holdings across industries," said Christian Magoon, Senior Managing Director and head of the ETF Group for Claymore Securities, Inc. "The Claymore/Morningstar Super Sector Index ETFs seek to provide investors with the opportunity to gain broader sector exposure and the potential to add balance to a concentrated portfolio." Magoon continued, "Developing this partnership with Morningstar continues Claymore's tradition of access to innovation, which we feel distinguishes us from other ETF providers." "The Morningstar Super Sector Indexes offer investors a different way of looking at the market," said Sanjay Arya, director of Morningstar Indexes. "Our Super Sector structure represents a unique way to classify companies based on the broad economic spheres in which they operate. This intuitive, consumption-based organization of sectors mimics the way economies evolve from dependence on the production of physical products to the delivery of services, which culminates in the exchange of information." The three new ETFs include: Claymore/Morningstar Information Super Sector Index ETF (NYSE: MZN) * The Claymore/Morningstar Information Super Sector Index ETF tracks an equity index, which is designed to identify and track companies in industries that support and facilitate the exchange of ideas and information as a basis for commerce. This ETF seeks investment results that correspond generally to the performance, before the Fund's fees and expenses, of an equity index called the Morningstar Information Super Sector Index. Eligible index securities include the total investable universe of the software, hardware, media and telecommunications sectors. Claymore/Morningstar Services Super Sector Index ETF (NYSE: MZO) * The Claymore/Morningstar Services Super Sector Index ETF tracks an equity index, which is designed to identify and track companies in industries whose main source of revenue comes from the provision of services. This ETF seeks investment results that correspond generally to the performance, before the Fund's fees and expenses, of an equity index called the Morningstar Services Super Sector Index. Eligible index securities include the total investable universe of the healthcare, consumer services Consumer Services refers to the formulation, deformulation, technical consulting and testing of most consumer products, such as food, herbs, beverages, vitamins, pharmaceuticals, cosmetics, hair products, household cleaners, [paints, plastics, metals, waxes, coatings, minerals, , business services and financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. sectors. Claymore/Morningstar Manufacturing Super Sector Index ETF (NYSE: MZG) * The Claymore/Morningstar Manufacturing Super Sector Index ETF tracks an equity index, which is designed to identify and track companies in "smokestack" industries that process raw materials into physical goods that are sold into industrial and consumer markets. This ETF seeks investment results that correspond generally to the performance, before the Fund's fees and expenses, of an equity index called the Morningstar Manufacturing Super Sector Index. Eligible index securities include the total investable universe of the following sectors: consumer goods consumer goods Any tangible commodity purchased by households to satisfy their wants and needs. Consumer goods may be durable or nondurable. Durable goods (e.g., autos, furniture, and appliances) have a significant life span, often defined as three years or more, and , industrial materials, energy and utilities. The three Morningstar Super Sector Indexes are reconstituted twice annually, in June and December. About Claymore Securities Claymore Securities, Inc. is a privately-held financial services company offering unique investment solutions for financial advisors and their valued clients. As of July 31, 2007, Claymore entities have provided supervision, management, servicing or distribution on more than $17 billion in assets through closed-end funds Closed-end fund An investment company that issues shares like any other corporation and usually does not redeem its shares. A publicly traded fund sold on stock exchanges or over the counter that may trade above or below its net asset value. Related: Open-end fund. , unit investment trusts, mutual funds, and exchange-traded funds. Claymore Advisors, LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control , an affiliate of Claymore Securities, serves as investment adviser to the Claymore ETFs. About Morningstar Morningstar, Inc. is a leading provider of independent investment research in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. and in major international markets. The company offers an extensive line of Internet, software, and print-based products and services for individuals, financial advisors, and institutions. Morningstar provides data on more than 250,000 investment offerings, including stocks, mutual funds, and similar vehicles. The company has operations in 16 countries and minority ownership positions in companies based in three other countries. Risks and Other Considerations There can be no assurance that an ETF will achieve its investment objective. An investment in the Fund is subject to investment risk, which is the possible loss of the entire principal amount that you invest. There is a risk that the value of the securities held by the Fund will fall due to general market and economic conditions. The Investment Adviser's license agreement with the Index Provider to use the Index has a five-year term, and is renewable thereafter on an annual basis. There can be no assurance that the license agreement will be renewed or extended at the end of that term, see the prospectus for more information. Non-diversified ETFs invest a greater portion of assets in securities of individual issuers than a diversified ETF and therefore, may cause greater volatility. ETFs are not "actively" managed and would not necessarily sell a stock because the stock's issuer was in financial trouble unless that stock is removed from the index. ETFs are subject to potential tracking errors and returns may not match the returns of the indices. ETFs that focus on small or medium-sized companies generally experience greater price volatility and risk than investing in more established companies. In addition to the risk described above, the ETFs are also subject to individual sector risk: For MZN: Software/Hardware Sector Risk. Competitive pressures may have a significant effect on the financial condition of companies in the software and hardware sectors. Also, many of the products and services offered by software and hardware companies are subject to the risks of short product cycles and rapid obsolescence ob·so·les·cent adj. 1. Being in the process of passing out of use or usefulness; becoming obsolete. 2. Biology Gradually disappearing; imperfectly or only slightly developed. . Companies in the software and hardware sectors also may be subject to competition from new market entrants. Such companies also may be subject to risks relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc research and development costs and the availability and price of components. As product cycles shorten and manufacturing capacity increases, these companies could become increasingly subject to aggressive pricing, which hampers profitability. Media Sector Risk. Companies engaged in design, production or distribution of goods or services for the media industry (including television or radio broadcasting The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. or manufacturing, publishing, recordings and musical instruments, motion pictures and photography) may become obsolete quickly. Media companies are subject to risks which include cyclicality of revenues and earnings, a decrease in the discretionary income Discretionary Income The amount of an individual's income available for spending after the essentials have been taken care of. Notes: Essentials are things like food, clothing, and shelter. of targeted individuals, changing consumer tastes and interests, fierce competition in the industry and the potential for increased government regulation. Media company revenues are dependent in large part on advertising spending. A weakening general economy or a shift from online to other forms of advertising may lead to a reduction in discretionary spending on online advertising. Additionally, companies engaged in the media industry can be significantly affected by federal deregulation Deregulation The reduction or elimination of government power in a particular industry, usually enacted to create more competition within the industry. Notes: Traditional areas that have been deregulated are the telephone and airline industries. of cable and broadcasting, competitive pressures and government regulation. Telecommunications Sector Risk. The telecommunications sector is subject to extensive government regulation. The costs of complying with governmental regulations, delays or failure to receive required regulatory approvals or the enactment of new adverse regulatory requirements Regulatory requirements are part of the process of drug discovery and drug development. Regulatory requirements describe what is necessary for a new drug to be approved for marketing in any particular country. may adversely affect the business of the telecommunications companies See telecom company. . The telecommunications sector can also be significantly affected by intense competition, including competition with alternative technologies such as wireless communications wireless communications System using radio-frequency, infrared, microwave, or other types of electromagnetic or acoustic waves in place of wires, cables, or fibre optics to transmit signals or data. , product compatibility, consumer preferences, rapid obsolescence and research and development of new products. Other risks include those related to regulatory changes, such as the uncertainties resulting from such companies' diversification into new domestic and international businesses, as well as agreements by any such companies linking future rate increases to inflation or other factors not directly related to the actual operating profits Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. of the enterprise. For MZO: Health Care Sector Risk. Companies in the health care sector may be susceptible to government regulation and reimbursement Reimbursement Payment made to someone for out-of-pocket expenses has incurred. rates. Such companies may also be heavily dependent on patent protection, with their profitability affected by the expiration of patents. Companies in the health care sector may also be subject to expenses and losses from extensive litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. based on product liability and similar claims, as well as competitive forces that may make it difficult to raise prices and, in fact, may result in price discounting. The process for obtaining new product approval by the Food and Drug Administration is long and costly. Health care service providers may have difficulty obtaining staff to deliver service, and may be susceptible to product obsolescence. Such companies also may be characterized by thin capitalization and limited product lines, markets, financial resources or personnel. Consumer Services Sector Risk. The success of companies in the consumer services sector depends heavily on disposable household income and consumer spending Consumer demand or consumption is also known as personal consumption expenditure. It is the largest part of aggregate demand or effective demand at the macroeconomic level. . Companies in the consumer services sector may be subject to severe competition. Changes in demographics The attributes of people in a particular geographic area. Used for marketing purposes, population, ethnic origins, religion, spoken language, income and age range are examples of demographic data. and consumer tastes can also affect the demand for, and success of, consumer products in the marketplace. Also, the success of food and soft drink may be strongly affected by fads, marketing campaigns and other factors affecting supply and demand. Business Services Sector Risk. Companies in the business services sector can be significantly affected by competitive pressures, such as technological developments, fixed-rate pricing, and the ability to attract and retain skilled employees. The success of companies that provide business-related services is, in part, subject to continued demand for business services as companies and other organizations seek alternative, cost-effective means to meet their economic goals. Financial Services Sector Risk. The financial services sector is subject to extensive government regulation, can be subject to relatively rapid change due to increasingly blurred distinctions between service segments, and can be significantly affected by availability and cost of capital funds, changes in interest rates, the rate of corporate and consumer debt defaults, and price competition. For MZG: Consumer Goods Sector Risk. Companies engaged in the manufacture and distribution of consumer goods are subject to vast fluctuations in supply and demand. These companies may also be adversely affected by changes in consumer spending as a result of world events, political and economic conditions, commodity price volatility, changes in exchange rates, imposition of import controls, increased competition, depletion of resources and labor relations. Companies in this sector are subject to government regulation affecting the permissibility of using various food additives food additives, substances added to foods by manufacturers to prevent spoilage or to enhance appearance, taste, texture, or nutritive value. By quantity, the most common food additives are flavorings, which include spices, vinegar, synthetic flavors, and, in the and production methods, which regulations could affect company profitability. Tobacco companies may be adversely affected by the adoption of proposed legislation and/or by litigation. Also, the success of food and soft drink may be strongly affected by fads, marketing campaigns and other factors affecting supply and demand. Industrial Materials Sector Risk. The companies in the industrial materials sector can be significantly affected by the level and volatility of commodity prices, the exchange value of the dollar, import controls, worldwide competition, liability for environmental damage, depletion of resources, and mandated expenditures for safety and pollution control. The stock prices of companies in the industrial materials sector are affected by supply and demand both for their specific product or service and for industrial materials sector products in general. Government regulation, world events and economic conditions may affect the performance of companies in the industrial materials sector. Companies in the industrial materials sector may be at risk for product liability claims. Energy Sector Risk. The profitability of companies in the energy sector is related to worldwide energy prices, exploration, and production spending. Such companies also are subject to risks of changes in exchange rates, government regulation, world events, depletion of resources and economic conditions, as well as market, economic and political risks of the countries where energy companies are located or do business. Oil and gas exploration and production can be significantly affected by natural disasters. Companies in the energy sector may be adversely affected by changes in exchange rates, interest rates, government regulation, world events, and economic conditions. Oil exploration and production companies may be at risk for environmental damage claims. Utilities Sector Risk. The rates that traditional regulated utility companies may charge their customers generally are subject to review and limitation by governmental regulatory commissions. Although rate changes of a utility usually fluctuate in approximate correlation with financing costs due to political and regulatory factors, rate changes ordinarily occur only following a delay after the changes in financing costs. This factor will tend to favorably affect a regulated utility company's earnings and dividends in times of decreasing costs, but conversely con·verse 1 intr.v. con·versed, con·vers·ing, con·vers·es 1. To engage in a spoken exchange of thoughts, ideas, or feelings; talk. See Synonyms at speak. 2. , will tend to adversely affect earnings and dividends when costs are rising. The value of regulated utility debt securities (and, to a lesser extent, equity securities) tends to have an inverse relationship A inverse or negative relationship is a mathematical relationship in which one variable decreases as another increases. For example, there is an inverse relationship between education and unemployment — that is, as education increases, the rate of unemployment to the movement of interest rates. Certain utility companies have experienced full or partial deregulation in recent years. These utility companies are frequently more similar to industrial companies in that they are subject to greater competition and have been permitted by regulators to diversify outside of their original geographic regions and their traditional lines of business. These opportunities may permit certain utility companies to earn more than their traditional regulated rates of return. Some companies, however, may be forced to defend their core business and may be less profitable. In addition to the risks described above, there are certain other risks related to investing in ETFs. Please read the prospectus for more detailed information. Claymore ETFs are listed on the AMEX AMEX See: American Stock Exchange , NYSE or NYSE Arca, depending on the ETF listing, the same way as shares of a publicly-traded company. These Claymore ETFs are listed on the NYSE Arca. Claymore ETFs can be purchased through most brokerage accounts Brokerage Account An arrangement between an investor and a licensed brokerage firm that allows the investor to deposit funds with the firm and place investment orders through the brokerage, which then carries out the transactions on the investor's behalf. . They can be bought and sold throughout the day on the AMEX, NYSE, or NYSE Arca depending on the ETF listing, during normal trading hours. The Fund issues and redeems Shares at NAV See navigation system and navigation bar. only in large blocks of 150,000 Shares (each block of 150,000 Shares called a "Creation Unit") or multiples thereof. As a practical matter, only broker-dealers or large institutional investors Institutional Investor A non-bank person or organization that trades securities in large enough share quantities or dollar amounts that they qualify for preferential treatment and lower commissions. with creation and redemption agreements and called Authorized Participants Authorized Participant An entity chosen by an exchange-traded fund's sponsor to undertake the responsibility of obtaining the underlying assets needed to create an ETF. Authorized participants are typically large institutional organizations, such as market makers or specialists. ("APs") can purchase or redeem these Creation Units. The investors buying or selling ETF shares on the secondary market may incur brokerage costs and other transactional fees. Shares of ETFs may fluctuate in price due to daily changes in trading volume Trading volume The number of shares transacted every day. As there is a seller for every buyer, one can think of the trading volume as half of the number of shares transacted. That is, if A sells 100 shares to B, the volume is 100 shares. . At times, shares may not have a high volume of trading. Except when aggregated in Creation Units, Shares are not redeemable securities of the Funds. Investors should consider the investment objectives and policies, risk considerations, charges and expenses of the ETFs carefully before investing. The prospectus contains this and other information relevant to an investment in the ETFs. Investors should read the prospectus carefully before investing or sending money. For this and more information, please contact a securities representative or Claymore Securities, Inc., 2455 Corporate West Drive, Lisle, IL 60532; 2100 Enterprise Avenue, Geneva Geneva, canton and city, Switzerland Geneva (jənē`və), Fr. Genève, canton (1990 pop. 373,019), 109 sq mi (282 sq km), SW Switzerland, surrounding the southwest tip of the Lake of Geneva. , IL 60134; 800-345-7999 or www.claymore.com/efs NOT FDIC FDIC See: Federal Deposit Insurance Corporation FDIC See Federal Deposit Insurance Corporation (FDIC). - INSURED - NOT BANK - GUARANTEED - MAY LOSE VALUE Claymore Securities, Inc. Member FINRA/SIPC 08/07 1 There is a contractual fee waiver in place for these ETFs through December 31, 2009 such that expenses are limited to 0.40% of average net assets Net assets The difference between total assets on the one hand and current liabilities and noncapitalized long-term liabilities on the other hand. net assets See owners' equity. . However, certain expenses will fall outside of this expense cap and actual expenses may be higher than 0.40%. Without this expense cap, actual returns would be lower. |
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