NEW YORK--(BUSINESS WIRE)--
Six Market Vectors fixed income exchange-traded funds (ETFs) have received risk-based capital ratings from the Securities Valuation Office (SVO) of the National Association of Insurance Commissioners (NAIC), it was announced today. Ratings assess credit quality of fixed income securities and can allow for favorable risk-based capital treatment when a fund is added to portfolios of state regulated insurance companies.
SVO ratings range from 1 to 6, with 1 being highest in terms of credit quality. Below are the NAIC rating designations for the Market Vectors ETFs that have been rated:
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“We’re very pleased to have received SVO designations for six of our funds, as these ratings help provide state regulated insurance companies with guidance as to the credit quality of a fund’s underlying holdings,” said Susan Marino, Senior Vice President and Director of National Accounts at Van Eck Global. “We’re pleased to offer insurance companies these Market Vectors ETF solutions as they take a closer look at opportunities to expand their investment choices.”
“Insurance companies are increasingly looking to use ETFs based on their flexibility, transparency and low-cost structure,” said Bill Best, Managing Director, Institutional Sales and Investor Relations at Van Eck Global. “NAIC ratings are a critical tool allowing insurance general account managers to utilize this fast growing and dynamic part of the market while also efficiently managing their risk-based capital requirements.”
NAIC, the U.S. standard-setting and regulatory support organization, was created and is governed by the chief insurance regulators of the 50 states, the District of Columbia and five U.S. territories. The SVO is responsible for day-to-day credit quality assessment and valuation of securities owned by state regulated insurance companies. The assignment of an NAIC designation allows a fixed income ETF to be reported as a bond, and therefore receive a more favorable risk-based capital treatment.
About Market Vectors ETFs
Market Vectors exchange-traded products have been offered since 2006 and span many asset classes, including equities, fixed income (municipal and international bonds) and currency markets. The Market Vectors family totaled $21.8 billion in assets under management, making it the seventh largest ETP family in the U.S. and tenth largest worldwide as of June 30, 2013.
Market Vectors ETFs are sponsored by Van Eck Global. Founded in 1955, Van Eck Global was among the first U.S. money managers helping investors achieve greater diversification through global investing. Today, the firm continues this tradition by offering innovative, actively managed investment choices in hard assets, emerging markets, precious metals including gold, and other alternative asset classes.
Preliminary NAIC Designations are the intellectual property of the National Association of Insurance Commissioners (NAIC) and are redistributed here under License. A Preliminary NAIC Designation is an opinion of the NAIC Securities Valuation Office (SVO) of the probable credit quality designation that would be assigned by the SVO to an investment if purchased by an insurance company and reported to the SVO. A Preliminary NAIC Designation is only one of the regulatory factors considered by the SVO as part of its analysis of probable regulatory treatment under the Regulatory Treatment Analysis Service (RTAS). A full discussion of such other regulatory factors is set forth in the RTAS Letter provided to Van Eck Associates Corporation. A Preliminary NAIC Designation cannot be used to report the ETF to state insurance regulators. However, the purchasing insurance company may obtain an NAIC Designation for the ETF by filing the security and final documents for the ETF with the SVO. The indication of probable regulatory treatment indicated by a Preliminary NAIC Designation is not a recommendation to purchase the ETF and is not intended to convey approval or endorsement of the ETF Sponsor or the ETF by the NAIC.
Investing involves substantial risk and high volatility, including possible loss of principal. Bonds and bond funds will decrease in value as interest rates rise. An investor should consider the investment objective, risks, charges and expenses of the Fund carefully before investing. To obtain a prospectus and summary prospectus, which contains this and other information, call 888.MKT.VCTR or visit marketvectorsetfs.com. Please read the prospectus and summary prospectus carefully before investing.
Van Eck Securities Corporation, Distributor, 335 Madison Avenue, New York, NY 10017
- Van Eck Global
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Chris Sullivan, 212-473-4442