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Summary Investor interest in corporate spinoffs is increasing fueled by eBay’s planned spinoff of PayPal and Carl Icahn’s involvement in the process. Currently, this ETF has only one competitor with a similar strategy giving this fund the potential to increase AUM nicely over time. Companies like Occidental Petroleum, Sears, Time Warner and Kimberly-Clark have all spun off business units recently. It’s not the first of its kind but the freshly launched Market Vectors Global Spin Off ETF (NYSEARCA: SPUN ) could be debuting at just the right time to take advantage of the increasing shareholder interest in capturing the intrinsic value that comes with companies spinning off subsidiaries. The most notable corporate spinoff is the one coming this summer – eBay’s (NASDAQ: EBAY ) planned spinoff of PayPal (Pending: PYPL ). eBay itself including PayPal has a market cap of around $75B but analysts are already frothing at the idea of PayPal’s value as an independent company. Needham & Co. came up with an estimate of around $50B . Carl Icahn and Elon Musk agree that PayPal needs to be spun off with Musk saying that PayPal could be worth as much as $100B . You can see why investors are so interested in PayPal’s spinoff. eBay isn’t the only company jumping on the trend. BHP Billiton (NYSE: BHP ), Occidental Petroleum (NYSE: OXY ), Kimberly-Clark (NYSE: KMB ), Chesapeake Energy (NYSE: CHK ), Time Warner (NYSE: TWX ) and Sears (NASDAQ: SHLD ) have all spun off units of their businesses recently. Therefore, the timing may be right for a launch such as this. The index provider, Horizon Kinetics, looks to maintain an equal weighted portfolio and capture value in all stages of the spinoff cycle. According to the fact sheet: For each company, an early entry at the start of the spin-off cycle aims to exploit valuation disconnects caused by selling pressure and pricing inefficiencies. A long-term hold seeks to capture periods of improved operating efficiency. Currently, the fund counts Abbvie (NYSE: ABBV ), Starz (NASDAQ: STRZA ) and Prothena (NASDAQ: PRTA ) among its top holdings. Like most newly launched ETFs, the asset base is small and the trading volume is thin. With assets under management at just $2M and the fund trading only a couple thousand shares a day it may be a while until this fund begins trading efficiently. In the short term, its counterpart, the Guggenheim Spin Off ETF (NYSEARCA: CSD ) might be a slightly better option at with over $500M in AUM and daily volume at almost 50,000 shares. The fund’s net expense ratio of 0.55% seems reasonable and compares favorably to the Guggenheim ETF’s ratio of 0.66%. While the ETF’s mandate aims to build a global portfolio the majority of holdings are still based in the U.S. 67% of the portfolio comes from the United States while Australia and the U.K. are the next largest countries represented at roughly 5% each. Consumer discretionary, financials and industrials are the largest sectors represented and comprise roughly 62% of the portfolio combined. Conclusion The ETF looks to capture an interesting and potentially profitable niche of the market and should be able to garner investor interest over time. The Guggenheim ETF is really the only other one out there with a similar strategy. This ETF may still be a little early in its life cycle to warrant any kind of significant investment but over time it should do fine. Given the fact that it’s primarily a small/mid cap portfolio, fairly concentrated and carries significant business-specific risk, this ETF carries a higher degree of risk and should be added to a broader portfolio appropriately. Longer term, I still like the potential of this fund. Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. (More…) I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.