First ETF tracking US restaurants launched by ETF Managers Group

Oct 30th, 2015 | By | Category: Equities

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ETF Managers Group, a white-label services provider to the exchange-traded funds industry, has launched the first ETF to focus exclusively on restaurants (NASDAQ: BITE). The fund aims to track the BITE Index which has been created by investment firm Big Tree Capital to track the performance of the world’s most recognisable and iconic restaurant brands.

First ETF tracking US restaurants launched by ETF Managers Group

The ETF tracks the performance of some of the world’s most recognisable and iconic restaurant brands.

“The percentage of income that Americans spend on food outside the home has been steadily growing over the last 150 years,” said Kevin Carter, Founder and CEO of Big Tree Capital and the creator and owner of The BITE Index. “The average American household spends over $2,600 a year at restaurants. BITE gives investors the ability to literally ‘put their money where their mouth is,’ allowing them to invest in conjunction with their own spending habits.”

Sam Masucci, Founder and CEO of ETF Managers Group, added: “We are proud to launch BITE, the first pure restaurant ETF to hit the market and the latest addition to the ETF Managers Group family of exchange-traded funds. BITE gives investors the ability to invest in the iconic restaurant brands, which are ingrained in US food culture as we know it today.”

Restaurant demand is driven by a combination of consumer confidence and taste. With unemployment in the US at a seven-year low, and consumer sentiment significantly ahead of the lows seen in 2009 (although trending down in recent months), demand for “eating out” could spur share price outperformance for the industry. By providing a diversified exposure to publicly-listed restaurant companies the index should also be able to weather the ebb and flow of consumer tastes.

The BITE Index tracks an equal-weighted allocation to all restaurants that are publicly-traded in the United States with a market cap of $200m or greater and $1m of daily average turnover. It is rebalanced semi-annually in June and December and is currently comprised of 45 companies.

The fund invests in firms operating in a wide variety of restaurant formats including quick service (e.g. Starbucks), fast casual (e.g. Chipotle), casual dining (e.g. Buffalo Wild Wings) and fine dining (e.g. Ruth’s Chris).

Listed on the NASDAQ, the fund carries a 0.75% expense ratio.

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