State Street Global Advisors has filed to launch SPDR S&P Commercial Paper ETF, we just learned from Strategic Insight's SimFundFiling. Once live, this product likely will become the first true "cash" or "money market" ETF offering, as well as the first cash "index fund". The ETF will be advised by SSgA Funds Management and distributed by State Street Global Markets. The full filing may be seen here, and more information may be found at www.SPDRETFs.com once the fund is launched.

The SEC EDGAR filing says, "The Fund, using an 'indexing' investment approach, seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the S&P Commercial Paper Index.... The S&P Commercial Paper Index measures the performance of the U.S. one-to three-month commercial paper market. The Index includes commercial paper issued by corporate issuers with a maximum program size of at least $2 billion. Asset-backed issuers are not eligible. To be included ... commercial paper must: (1) be priced by the Interactive Data Corporation; (2) have a remaining maturity of between 31 and 91 days; and (3) have a current rating from at least" S&P, Moody's or Fitch."

The new ETF will be run by Todd Bean, SSgA principal and portfolio manager in the U.S. Cash Management Group, Steve Meier, senior managing director of SSgA and a member of the firm's Global Fixed Income portfolio management team, with responsibility for U.S. cash, cash collateral and short-duration portfolio management, and Jeff St. Peters, vice president and senior portfolio manager within the Global Cash Management unit of SSgA's Fixed Income group. The fund will pay dividends and will fluctuate in value. It may also invest in repo and money market funds.

Previous short-term, fixed-income ETFs, such as Bear Stearns Current Yield (YYY), Wisdom Tree U.S. Current Income Fund (USY), and Barclays 1-3 Year Lehman Treasury ETF, have turned out to be enhanced cash funds with longer maturities and/or invested in lower quality securities than permitted by money market funds. SPDR S&P Commercial Paper ETF appears to be the closest ETF yet to a money market fund, though it too likely won't be able to use the moniker. For more on "near-cash" ETFs, see our previous stories: "Bond ETFs Benefitting As Customers Seek Better 'Sweeps'", "More Ultra-Short ETFs on the Way: SPDR Lehmans from SSGA", "Bear Stearns Files to Launch First 'Cash' ETF, Current Yield Fund".

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