Americas ETP News
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DB Equity Research Equity Research-North America-ETP assets down by 1.2%, but flows are not really bearish
March 26, 2012--Net Cash Flows Review
Last week, markets cooled down a bit recording the second negative week of the year for the S&P 500. The US (S&P 500) lost 0.50%. Other developed and emerging markets outside the US did worse; the MSCI EAFE (in USD) dropped by 1.48%, while the MSCI EM (in USD) declined by 1.99% during the week.
Moving on to other asset classes, the 10Y Treasury yield retreated by 6bps last week, while the DB Liquid Commodity Index was down by 1.18%. Other sectors were mixed. The Agriculture sector (DB Diversified Agriculture Index), WTI Crude Oil, and Silver prices fell by 0.77%, 0.18%, and 0.95%, respectively; while Gold prices edged slightly higher by 0.11%. Last but not least, Volatility (VIX) advanced by 2.42% during the same period.
The total US ETP flows from all products registered $5.6bn of outflows during last week vs $14.4bn of inflows the previous week, setting the YTD weekly flows average at +$4.0bn (+$47.7bn YTD in total cash flows).
As expected, the outflows for this week were driven by SPY outflows (-$6.4bn), which were most likely linked to the unwinding of positions related to the S&P 500 quarterly rebalancing, therefore flows could be not as bearish as they seem, but rather neutral to positive on risk still. Equity, Fixed Income, and Commodity ETPs experienced flows of -$5.1bn, +$0.5bn, and -$0.7bn last week vs. +$13.2bn, +$1.1bn, and -$0.0bn the previous week, respectively.
Within Equity ETPs, Commodity Themed products experienced the largest inflows (+$0.2bn); while Large Cap vehicles experienced the largest outflows (-$5.0bn), followed by US Sector ETPs (-$0.9bn). Within Fixed Income ETPs Corporates recorded the largest inflows (+$0.2bn), followed by Sovereign products (+$0.1bn). Within Commodity ETPs, Precious Metals experienced a leak of assets of -$0.7bn.
Top 3 ETPs & ETNs by inflows: QQQ (+$0.8bn), KBE (+$0.4bn), GDX (+$0.2bn)
Top 3 ETPs & ETNs by outflows: SPY (-$6.4bn), XLE (-$0.6bn), GLD (-$0.6bn)
New Launch Calendar: 3 new equity products
There were two new ETFs and one new ETN listed on NYSE Arca during the previous week. The new products provide exposure to small cap Indonesian companies, international REITs, and the equally-weighted NASDAQ 100 version.
Turnover Review: floor activity still trapped in low levels
Total weekly turnover declined by 11.1% to $282bn vs. $318bn in the previous week. The largest decrease was on Equity ETP turnover, which fell by $23.2bn or 8.6% to $247bn. Commodity and Fixed Income ETP turnover followed with decreases of 30.2% (-$7.0bn) and 21.6% (-$4.6bn), respectively.
Assets Under Management (AUM) Review: 1.2% down on markets and flows
Negative equity markets and outflows contributed to a pull-back in ETP assets pushing down the AUM by 1.2% to $1.19 trillion; total ETP assets lost $14.1bn from the previous week’s AUM level. YTD growth remains strong at 13.3%, however. Assets for equity, fixed income and commodity ETPs moved -$13.4bn, +$0.6bn, and -$0.9bn during last week, respectively.
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Source: Deutsche Bank-Equity Research-North America
Morgan Stanley-US ETF Weekly Update
March 26, 2012--Weekly Flows: $5.6 Billion Net Outflows
ETFs Have Generated $47.2 Billion In Net Inflows YTD
ETF Assets Stand at $1.2 Trillion, up 13% YTD
Two ETF Launches Last Week
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US-Listed ETFs: Estimated Flows by Market Segment
ETFs posted net outflows for only the second week this year ($5.6 bln net outflows last week)
Last week’s net outflows were the most since the week of 9/19/11 and follow a week of $14.4 bln in net inflows
Net outflows were primarily driven by US Large-Cap ETFs last week ($4.8 bln); specifically, the SPDR S&P 500 ETF (SPY)
posted net outflows of $6.4 bln
ETF assets stand at $1.2 tln, up 13% YTD; ETFs have generated $47.2 bln in net inflows YTD
13-week flows were mostly positive among asset classes; combined $48.6 bln net inflows
Fixed Income ETFs have consistently generated weekly net inflows (32 straight weeks of net inflows)
Over the past 13 weeks, US Custom ETFs have posted net inflows of $2.0 bln, which equates to 22% of its market cap
US-Listed ETFs: Estimated Largest Flows by Individual ETF
PowerShares QQQ (QQQ) posted net inflows of $818 mln last week, the most of any ETF
SPDR S&P 500 ETF (SPY) exhibited the largest net outflows last week at $6.4 bln; as noted in our previous US ETF Weekly
Update, we anticipated SPY to exhibit net outflows last week as portfolio managers unwind the quarterly rebalancing trade from the prior week (index rebalancing took place the 3rd Friday of March)
Over the past 13 weeks the Vanguard MSCI Emerging Markets ETF (VWO) has exhibited net inflows of $6.2 bln, the most of any ETF
US-Listed ETFs: Short Interest
Data Unchanged: Based on data as of 2/29/12
SPDR S&P 500 ETF (SPY) posted the largest increase in USD short interest for the 2nd consecutive period
Despite SPY’s increase in shares short, SPY’s shares short are still well below their all-time high reached on 9/15/11
ProShares Ultra Silver (AGQ) posted the largest drop in USD short interest since last updated; AGQ’s decline is noteworthy because it only has a market cap of $915 million (typically larger funds account for the biggest changes in this exhibit)
Financials-focused ETFs make up 3 of the 10 most heavily shorted ETFs (shares short/shares outstanding)
The average shares short/shares outstanding for ETFs is currently 5%
Based on multiple borrowings and the ability to continuously create new shares, short interest as a % of market cap can exceed 100%
US-Listed ETFs: Most Successful Recent Launches by Assets
Source: Bloomberg, Morgan Stanley Smith Barney Research.
Data estimated as of 3/23/12 based on daily change in share counts and daily NAVs.
$8.7 billion in total market cap of ETFs less than 1-year old
Over the past 13 weeks, newly launched US Custom ETFs generated most net inflows at $873 mln
71 new ETF listings and 16 closures YTD; at this point last year, only 45 ETFs had come to market
Over the past year, many of the successful launches have an income/dividend orientation
6 different ETF sponsors and 2 asset classes represented in top 10 most successful launches
The heavily anticipated PIMCO Total Return ETF (TRXT), an actively managed bond fund managed by PIMCO launched on 3/1/12, has exhibited strong growth with a market cap of $256 mln (flows in table do not include seed money)
Top 10 most successful launches account for 59% of market cap of ETFs launched over the past year
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Source: Morgan Stanley
Horizon Investments Active Asset Allocation Fund is Launched
March 26, 2012--Horizon Investments, LLC today introduced a no-load mutual fund with a tactical global asset allocation strategy that invests in exchange traded funds (ETFs).
The Horizon Active Asset Allocation Fund (ticker: AAANX) is available to individual investors through over 2,200 financial advisors affiliated with Cambridge Investment Research, Inc., a leading independent broker-dealer and member, FINRA/SIPC.
"We are very pleased to make this institutional-level strategy accessible for individual investors and their families," said Robbie Cannon, president and CEO of Horizon Investments. "We believe individual investors should have the same opportunities as our institutional clients to seek to build wealth in a managed risk environment."
Key elements of the Horizon Active Asset Allocation Fund include:
Global Investment Strategy: A single investment in this fund accesses a large universe of global investment opportunities. The fund seeks investments in 12 diverse asset classes.
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Source: Biz Journal
Vanguard ETF assets surge to top $200bn
March 25, 2012---Assets held in Vanguard's US exchange traded fund business reached the $200bn mark at the start of March and have since risen to $204bn, despite the Pennsylvania-based group being a relative latecomer to the ETF market.
Vanguard remains the third-largest ETF player globally, well behind longer established rival iShares, which had assets of $670bn at the end of February. But it could soon overhaul State Street Global Advisors, on $298bn.
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Source: FT.com
Standard & Poor's Announces Changes In The S&P/TSX Canadian Indices
March 23, 2012--Standard & Poor's will make the following changes in the S&P/TSX Canadian Indices:
Brookfield Office Properties Inc. (TSX:BPO) has announced that it will redeem for $CDN25.00 cash per share all of the outstanding shares of its Class AAA Preference Shares, Series "I" (TSX:BPO.PR.I) at the close on March 30, 2012.
The shares of this issue will be removed from the S&P/TSX Preferred Share Index and the S&P/TSX North American Preferred Stock Index after the close of trading on Friday, March 30, 2012.
Company additions to and deletions from an S&P equity index do not in any way reflect an opinion on the investment merits of the company.
Source: Standard & Poor's
Institutions Tipping the ETF Scale
March 23, 2012--When it comes to exchange-traded products, you either get it or you don't. And, according to Deutsche Bank, more institutional investors are getting it every day.
Analyzing U.S. Securities and Exchange Commission 13F filings, Deutsche Bank’s ETF research team summizes that 51.6% of all exchange-traded products in the United States were held by institutional investors, inlcuding brokers, registered investment advisers, hedge funds and, yes, mutual funds at the end of 2011.
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Source: Forbes
Treasury Report: Now is the Key Time to Invest in Infrastructure
March 23, 2012--A new report released today by the U.S. Department of Treasury with the Council of Economic Advisers finds that now is the key time to invest in infrastructure to create middle-class jobs, increase our long-term competiveness, and support a more secure energy future.
The President’s all-of-the-above strategy for American energy and his FY2013 Budget proposes a bold plan to renew and expand America’s infrastructure. The plan includes a $50 billion up-front investment connected to a $476 billion six-year reauthorization of the surface transportation program and the creation of a National Infrastructure Bank.
“This report highlights the need for critical investments in transportation to help ease the burden on middle-class families trying to make ends meet, create jobs where workers would especially benefit, and also strengthen our competitiveness and support business infrastructure over the long term,” said Assistant Secretary for Economic Policy Jan Eberly.
view the NEW ECONOMIC ANALYSIS OF INFRASTRUCTURE INVESTMENT
A REPORT PREPARED BY THE DEPARTMENT OF THE TREASURY WITH THE COUNCIL OF ECONOMIC ADVISERS
Source: US Department of the Treasury
CFTC.gov Commitments of Traders Reports Update
March 23, 2012--The current reports for the week of March 20 2012 are now available.
view updates
Source: CFTC.gov
Statement: BATS Global Markets Withdraws Initial Public Offering
March 23, 2012--BATS Global Markets, Inc. ("BATS") today announced it has withdrawn its planned initial public offering (IPO), which was scheduled to close on March 28, 2012.
"Although our affected market has reopened, in the wake of today's technical issues, which affected the trading of certain stocks, including that of BATS, we believe withdrawing the IPO is the appropriate action to take for our Company and our shareholders," said Joe Ratterman, chairman, president and CEO of BATS Global Markets.
Source: BATS
Buenos Aires Futures and Options Exchange (MATba) And Uruguay’s Stock Exchange (BVM) To Create A New Derivatives Market
March 23, 2012--Mercado a Termino de Buenos Aires – MATba (Buenos Aires Futures and Options Exchange) and Bolsa de Valores de Montevideo- BVM (Uruguay's Stock Exchange) announced that they will create a Futures and Options Exchange in Uruguay.
The new exchange will operate under the name "MATba Rio de la Plata Bolsa de Valores S. A." and will be the first derivatives market in Uruguay. The two exchanges are waiting for Uruguay’s Central Bank approval to start working on the first contracts, which will probably be cattle and agricultural commodities, leaving currencies and other financial products for a second stage. All contracts will be cash settled and traded electronically.
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Source: hftreview.com
