Some New ETFs Not Up to Snuff (VEGI, YMLP)

The pace of new ETF introductions has again been impressive in 2012, but that doesn't mean all new ETFs are flourishing. Sure, there are examples of ETFs that are doing well in terms of assets under management right off the bat. The WisdomTree Emerging Markets Corporate Bond Fund EMCB already has almost $60 million in AUM and it isn't even a month old. The Market Vectors Indonesia Small-Cap ETF IDXJ already has $4 million in AUM and that fund is just a week old. On the other hand, some rookie ETFs aren't giving reasons to leave more established funds or even look at the new kids on the block in the first place and that's referring either assets, performance or both. Surprisingly, some copycat funds have made nary a dent against their older rivals. Examples include: iShares MSCI Global Agriculture Producers Fund VEGI To be fair, the iShares MSCI Global Agriculture Producers Fund has slightly outperformed the Market Vectors Agribusiness ETF MOO since its early February debut. With an expense ratio of 0.39%, VEGI is cheaper than MOO, which charges 0.56%. We're not picking on VEGI, but this is the reality. With its thin volume, investors might encounter wide bid/ask spreads. That's a factor that will drive up costs and it's NOT an issue with MOO. Another cold hard fact is some ETFs have tried to compete with MOO in the past. All of have failed. MOO is the very definition of "first-to-market" advantage. VEGI probably won't head to the ETF graveyard because iShares doesn't have a tradition of closing ETFs, even its low asset, low volume funds, but the only other agribusiness ETF that really stands out is the IndexIQ Global Agribusiness Small-Cap ETF CROP, which is more complement to than rival of MOO. iShares MSCI Global Silver Miners Fund SLVP Just to be clear, we're really not picking on iShares. In fact, the iShares MSCI Global Gold Miners Fund RING deserves credit for pulling in almost $22.4 million in AUM in less than two months of trading. On the other hand, SLVP has just $4.6 million in AUM. That could be a case of bad timing since silver has been sliding the past few weeks. Or we could be seeing a replay of the VEGI/MOO scenario. In terms of SLVP, that means that the first-to-market advantage for the Global X Silver Miners ETF SIL might prove too big to overcome. Yorkville High Income MLP ETF YMLP The Yorkville High Income MLP ETF will be competing directly with the ALPS Alerian MLP ETF AMLP for investor dollars. We're not saying YMLP is a bad ETF. It already has almost $5 million in AUM, but there are issues to consider and those issues pertain to both AMLP and YMLP. It has been noted these ETFs do not have C-corporation structure as nearly all other ETF do. Not having the C-corp. structure can cost investors money, indicating that owning individual MLPs or MLP ETNs might be preferable to investing in MLP ETFs.