Barclays Global Investors will transfer the primary listing of 81 of its iShares exchange-traded funds to merger partners the New York Stock Exchange and Archipelago Holdings Inc.'s Archipelago Exchange, away from the American Stock Exchange, according to Lee Kranefuss, CEO of BGI's intermediary business.
The transition, which requires SEC approval, will take place in phases beginning later this year and ending in 2007. It includes moving the primary listings of 61 iShares to the Big Board and 20 to Archipelago. The NYSE already holds the primary listing for 16 iShares. In addition, one iShare, based on the Nasdaq biotech index, will remain at the American Stock Exchange and another, based on the S&P 100 index, will remain at the Chicago Board Options Exchange.
The move is "a culmination of a year-long review process," Mr. Kranefuss said on a conference call announcing the changes. "The growth of the fund family required us to look more closely at the listings. At the conclusion of the review, it became apparent that while the American Stock Exchange has been the best listing venue for many iShares in the past, the New York Stock Exchange and Archipelago are best suited for trading iShares in the future," he said. He cited the specialist system at the Big Board, its "prestige" and its heavy investment in technology, as well as the innovative nature and commercial success of Archipelago, where volume on some iShares tops 30%, as key reasons for the move.
"The primary driver was looking at market structure, the technical ability of the exchange or exchanges to evolve in a rapidly changing marketplace," and the commitment to ETF development and growth, he said.
"We will continue to trade these products and continue to compete for the business as we compete everyday," Cliff Weber, senior vice president of the ETF marketplace at the American Stock Exchange, said in an interview. "From that standpoint, we will continue to expand, to compete aggressively and to earn our share of the order flow."
Noting that the American Stock Exchange has listed 20 ETFs from four different issuers this year, Mr. Weber said the exchange currently has 164 ETFs listed.
"We certainly talked to (BGI) and stressed what we believed were our strengths," he added. "They made a decision based on how they felt."
BGI's 99 ETFs have $140 billion in combined assets.