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New exchange-traded fund opens up Start-Up Nation to investors

New ‘stock’ from BlueStar Indexes is latest Israeli advance in NASDAQ.

(L to R) Ido Aharoni, Steven Schoenfeld, and Nasdaq Executive VP Salil Donde ring the open bell December 3, 2015 (Courtesy)
(L to R) Ido Aharoni, Steven Schoenfeld, and Nasdaq Executive VP Salil Donde ring the open bell December 3, 2015 (Courtesy)

Investing in a start-up can be pricey, but far more affordable is investing in a share of stock that represents a lot of start-ups. That’s the rationale behind the newest Israeli “stock” – actually, exchange-traded fund – to trade on the Nasdaq. The new BlueStar TA-BIGITech Israel Technology ETF (Nasdaq symbol ITEQ) launched Thursday, with the Nasdaq celebrating with a cermonial opening-bell ringing by Israel’s Consul-General in New York Ido Aharoni, and officials from the Israeli Embassy and BlueStar.

“We are thrilled to celebrate the launch of ITEQ on the Nasdaq,” said Steven Schoenfeld, Founder of BlueStar Indexes. “As the first US-listed index product focused on the full universe of established and emerging innovation by Israeli companies, ITEQ provides a unique opportunity for investors to access Israel’s dynamic technology sector for their portfolios.” The Tel Aviv Stock Exchange adapted it as a benchmark in March 2015, as part of TASE’s globalization efforts, and assists in its dissemination during Israeli trading hours.

BlueStar, established in 2013, was the first – and is still the only – benchmark for investors to track Israeli equities. The BlueStar Israel Global Index (“BIGI”) is traded on the New York Stock Exchange (ticker symbol ISRA), and keeps track of Israeli companies traded on the Tel Aviv Stock Exchange and on other exchanges, including the New York Stock Exchange, NASDAQ and the London Stock Exchange. It’s a way for investors, both big and small, to keep track of Israeli companies, both veteran and start-up, said Schoenfeld.

With the new ITEQ ETF, said Schoenfeld, investors will have an entree into the very exciting – and profitable – world of the Start-Up Nation. “Israeli companies have a major presence on the Nasdaq, amongst the highest of any foreign listings, and 53 of the 65 stocks in ITEQ’s TA-BIGITech benchmark are Nasdaq-listed. The Israeli economy is forecast to grow by more than 3% in 2015, one of the highest developed market growth rates in the OECD, and Israel’s robust technology sector is anticipated to account for at least one-third of this growth.”

The idea proved popular among large investment houses as well. Factor Advisors – a subsidiary of ETF Managers Group – partnered with ITEQ ETF Partners – an affiliate of BlueStar Global Investors – to launch ITEQ on the Nasdaq. Penserra Capital acts as subadvisor, and Jane Street is the market maker for ITEQ.

“Israel is a leader in the high-tech industry and the Tel Aviv Stock Exchange is committed to ensuring that global Israeli tech companies are available to investors worldwide,” said Amnon Neubach, Chairman of the TASE. “The launch of the ITEQ ETF tracking TA-BIGITech will raise visibility of this important sector and strengthen TASE’s profile with global investors, contributing to our overall market and economic development.

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