August 18, 2011

SEA has done it again. This time the shipping ETF has changed its investment mandate. Instead of tracking the Delta Global Shipping Index, SEA will now track the Dow Jones Global Shipping Index and contain no less than 25 different shipping stocks and/or securities.

The DJ shipping index is new and comprises "25 leading dividend-paying companies in the shipping industry." This focus on stocks with a yield may make this ETF suitable for some investment accounts.

DJ Shipping Index Weights

According to Dow Jones, the weight of the individual components in the index is capped at 20%, and the aggregate total weight of all components comprising 4.5% or more of the index is limited to a 45% cap.

DJ Shipping Index Criteria

As we understand it, to be considered for inclusion in this index a shipping company must:

• ship cargo (as opposed to passengers);
• have a minimum market cap of $150 million;
• trade 90 day average daily dollar volume of at least USD $2 million; and
• pay a dividend.

The shipping stocks meeting these criteria are then ranked by dividend yield, and the top 25 highest dividend names are selected.