Source improves tracking with new MSCI Emerging Markets ETF

The latest Source ETF will achieve this consistent tracking of the underlying benchmark by transacting total return swaps with the issuer's partner counterparties. The ETF, listed on the London Stock Exchange, trades in US dollars, which Source says minimises foreign exchange-related tracking error. Tracking error can significantly detract from fund returns, and is a particular concern for investors in emerging markets products. Source says the tracking error on ETFs based on the MSCI Emerging Markets index ranges from one percent to 5.2%, caused by optimisation strategies, operati...