Thailand is finally going to have its first exchange-traded fund (ETF), and U.S. investors may benefit.

This past Tuesday saw the launch of an initial public offering (IPO)  for the ThaiDEX SET 50 ETF. The IPO will close on August 29, with trading in the fund set for September 6 on the Stock Exchange of Thailand (SET). Unlike U.S. ETFs, which launch with seed money from specialist firms, the initial assets in certain overseas markets ETFs come through an IPO/sales process.

The new ETF will track the SET 50, Thailand's blue-chip stock index. The SET is in talks with the Bank of Thailand to exempt the fund from the usual capital controls that are applied to mutual funds, which place limits on foreign investment. The ETF is managed by Thai firm One Asset Management Ltd.

SET expects the ETF to be cross-listed on other Asian exchanges next year, according to a Dow Jones Newswires article. The article also said that the SET plans to launch sector-based ETFs in the future.

ETFs are already widespread throughout Asia, trading in Japan, Hong Kong, Singapore, Malaysia, Taiwan and South Korea. Subscription to the IPO is expected to be fairly small because the products are not well-known in Thailand, the Newswires article noted.

The SET 50 was up roughly 15% from the end of 2006 through August 21, but down about 12% from its close at the end of July. Stocks were down almost across the board on the SET at the close of trading on August 21, as the Thai stock market feels the effects of the subprime mortgage meltdown in the United States.