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State Street to Launch First Global ETF
By John Spence
September 28, 2000

Ending Barclays short-lived hegemony in style-based exchange-traded funds (ETFs) and launching the first global ETF, State Street Global Advisors announced the opening of 7 new funds. Continuing its surge into the ETF market, State Street was scheduled to launch a variety of growth, value, and sector funds, as well as the first global ETF on Friday, September 28, 2000.

Dow Jones Indexes, a part of Dow Jones & Company, announced that the new family of ETFs would be launched tomorrow on the American Stock Exchange. Called StreetTRACKS, the new ETFs will be linked to Dow Jones Index and Morgan Stanley Index families, including:

Dow Jones Global Titans Index
Dow Jones U.S. Large Cap Growth Index
Dow Jones U.S. Large Cap Value Index
Dow Jones U.S. Small Cap Growth Index
Dow Jones U.S. Small Cap Value Index
Morgan Stanley High Tech 35 Index
Morgan Stanley Internet Index

"State Street Global Advisors has the distinction of launching the first ETF based on a global index [Dow Jones Global Titans Index]," said David Moran, President of Dow Jones Indexes.

The Dow Jones Global Titans index was launched in July of 1999 and currently has 21 licensees with assets approaching $2 billion, according to Dow Jones Indexes. The State Street offering, however, will attract the first exchange-traded fund cash to the index.

Dow Jones Global Titans Index Holdings as of Friday, March 24, 2000

Company	Country	Close	Shares	US $ % Chg	Market Cap	Weight
Microsoft Corp.	USA	111.688	5204852	-0.17	581.32	8.5
General Electric Co.	USA	159.063	3277652	-0.2	521.35	7.62
Intel Corp.	USA	139.063	3340999	-2.5	464.61	6.79
Exxon Mobil Corp.	USA	77.25	3461574	2.32	267.41	3.91
Deutsche Telecom AG	Ger	89.4	3029604	5.88	264.75	3.87
Wal-Mart Stores Inc.	USA	55.188	4453740	2.2	245.79	3.59
International Business Machines Corp.	USA	121	1802604	5.27	218.12	3.19
Lucent Technologies Inc.	USA	64.5	3187478	-0.67	205.59	3.01
Citigroup Inc.	USA	60.5	3371665	-2.12	203.99	2.98
France Telecom	Fra	191	1024615	5.07	191.3	2.8
AT&T Corp.	USA	58.813	3195043	2.73	187.91	2.75
Toyota Motor	Jap	5110	3760650	3.73	179.89	2.63
BP Amoco	UK	5.415	19486680	1.76	168.37	2.46
American International Group Inc.	USA	107.625	1548241	3.18	166.63	2.44
SBC Communications	USA	43.063	3411379	-1.15	146.9	2.15
Merck & Co.	USA	61.75	2337422	-1.79	144.34	2.11
Hewlett-Packard Co.	USA	142.375	1001493	-3.31	142.59	2.08
British Telecommunications	UK	12.64	6506713	2.82	131.23	1.92
Royal Dutch Petroleum	Swi	59	2144296	1.7	123.67	1.81
MCI Worldcom Inc.	USA	42.672	2838345	-0.62	121.12	1.77
Coca-Cola Co., The	USA	47	2469980	-1.31	116.09	1.7
Morgan Stanley,Dean Witter & Co.	USA	95.813	1136881	1.12	108.93	1.59
Hsbc Holdings	UK	7.725	8458658	4.75	104.27	1.52
Allianz AG	Ger	418.5	245270	3.26	100.34	1.47
Johnson & Johnson	USA	71.25	1391649	-10.94	99.15	1.45
Novartis AG (Namen)	Swi	2188	72130	2.7	97.22	1.42
Siemens AG	Ger	165.3	594841	5.15	96.11	1.4
Bank of America Corp.	USA	54.438	1707184	0.46	92.93	1.36
Bell Atlantic Corp.	USA	59.5	1552786	-0.21	92.39	1.35
Disney (Walt) Co.	USA	41.5	2069931	-0.3	85.9	1.26
BellSouth Corp.	USA	44.688	1881844	0.85	84.09	1.23
Roche Hldg AG (Drc)	Swi	19310	7026	1.18	83.57	1.22
Chase Manhattan Corp.	USA	96.188	824777	-2.35	79.33	1.16
Nestle SA (Namen)	Swi	2989	40352	2.73	74.3	1.09
Procter & Gamble Co.	USA	56.438	1315714	0.56	74.26	1.09
DaimlerChrysler AG	Ger	70.2	1013733	3.45	69.56	1.02
Bank of Tokyo-Mitsubishi Ltd.	Jap	1441	4675455	2.12	63.07	0.92
Lloyds TSB Group Plc	UK	6.65	5475337	5.79	58.1	0.85
Du Pont (E.I.) De Nemours & Co.	USA	54.813	1052473	-0.11	57.69	0.84
UBS	Swi	431.5	215289	2.69	57.22	0.84
Chevron Corp.	USA	85.625	656266	1.18	56.19	0.82
Credit Suisse Group (Namen)	Swi	331	273838	3.9	55.83	0.82
ING Groep N.V.	Net	56.79	996677	0.32	55.33	0.81
General Motors Corp.	USA	85.375	640208	-1.87	54.66	0.8
Ford Motor Co.	USA	44.688	1137033	0.42	50.81	0.74
AXA	Fra	144.6	356336	-0.97	50.37	0.74
Morris (Philip) Cos.	USA	19.813	2314476	1.28	45.86	0.67
ENI	Ita	5.02	8002128	0.47	39.27	0.57
Boeing Co., The	USA	36	934540	2.49	33.64	0.49
Unilever Nv (cva Ntfl4)	Net	48.78	571576	1.78	27.25	0.4

Source: Dow Jones & Company

The new ETF to be launched tomorrow based on the Dow Jones Global Titans Index could be particularly appealing to investors who wish to achieve global diversification, since the index has a limited number of holdings, high liquidity, and low component turnover.

"Since bringing the first ETF to market back in 1993, we have guided this burgeoning market in its evolution," said Timothy B. Harbert, President of State Street Global Advisors. "We have been pragmatic in our selection of funds and feel that the indices on which they are based are best-suited to meet the demands of investors."

State Street officials announced they would continue to evaluate the demand in the marketplace and look to possibly add further ETFs under this series. Additionally, SSgA announced that tomorrow it will be launching a new website devoted to the new ETFs, www.streetracks.com, for information including ordering or downloading prospectuses, index & fund fact sheets, and questions and answers.

Interestingly, the new Dow Jones style indexes were actually constructed by State Street about 15 years ago and sold to Dow, so that they could aggressively market them and build the brand value. State Street and Dow claim that the growth and value indexes are much better than the Russell/Barra combination used by Barclays iShares, because they have lower turnover and are more tax efficient.

As State Street ETF principal Gus Fleites, never one to be shy about taking a shot at Barclays noted, "I think you'll find that one of the biggest concerns investors have with the indexes that are out there right now is that they have significant turnover."

Fleites, whose remarks appeared in an exclusive IndexFunds article, was unavailable for further comment, as he is in New York with other State Street executives to ring the bell tomorrow at the American Stock Exchange (AMEX)