It was just a matter of time, I suppose. I'm having trouble understanding the difference between these iTraxx ETF's issued by DeutscheBank and a portfolio of bonds.
Holding ETFs that own a portfolio of bonds, like the Corporate Bond Index based iShares (LQD – $106.61), just seems more direct and simple. An ETF that uses credit derivatives just seems like a way to make the whole process more complicated for the investor and a way to insert more fees for the bankers/brokers/managers.
Here's a description of the Credit Derivative Based ETFs from IndexUniverse.com.
Disclosure: I own a tiny amount of LQD in my IRA. I've traded or used most kinds of derivatives at some point in my life but I never used a credit derivative. This is sort of embarrassing given what a huge product they've become. Guess I'll have to stick to boring old bonds for my retirement savings.