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State Street US ETF Snapshot: May 2011
June 14, 2011--As of May 31, 2011, 1,074 Exchange Traded Funds (ETFs)—with assets totaling $1.10TN—were managed by 35 ETF managers.
ETF industry assets fell $22.7BN for the month—down 2.0%.
The ETF Industry saw a 2.0% decline in assets during May. However, the Fixed Income category experienced a sizeable gain ($5.3BN).
STATE STREET HIGHLIGHTS, MAY 2011
Investing in International Inflation Protected Bonds
The SPDR® DB International Government Inflation Protected Bond ETF [WIP] provides exposure to the inflation-linked government bond markets of developed and emerging market countries outside the United States.
The Index includes government inflation-protected securities in 14 currencies and from 17 countries.
ETF Industry Detail
US Bonds were positive with the Barclays U.S. Treasury Index up 1.6% and the Barclays U.S. Aggregate Index rising 1.3%. The S&P 500® Index lost 1.1%, while the MSCI EAFE® Index dropped 2.8%. The S&P® GSCI Index declined 6.9% even though Gold remained flat.
Fixed Income assets gained $5.3BN.
FLOWS
ETF flows were negative in May, down $218MM, the first month of outflows since August of 2010. The Size - Large Cap category had the most outflows, losing $8.0BN, following an April in which it saw $6.7BN in inflows. The Commodity category also had a large amount of outflows, with $3.4BN leaving the category.
Manager and Fund Detail
The top three managers in the US ETF marketplace were: BlackRock, State Street, and Vanguard. Collectively, they account for approximately 83% of the US listed ETF market.
The top three ETFs in terms of dollar volume traded for the month were the SPDR S&P 500 [SPY], iShares Russell 2000 [IWM], and iShares Silver Trust [SLV].
•The top three ETFs in terms of assets for the month were the SPDR S&P 500 [SPY], SPDR Gold Shares [GLD], and Vanguard Emerging Markets [VWO].
visit www.spdrs.com for more info
Source: State Street Corporation
Component Changes Made to Dow Jones Country Titans Indexes
June 14, 2011--Dow Jones Indexes, a leading global index provider, today announced the results of the regular quarterly review of the Dow Jones Country Titans Indexes. Changes being announced today will be effective after the close of trading on Friday, June 17, 2011.
In the Dow Jones Canada Titans 60 Index, Sino-Forest Corp. (Canada, Basic Resources, TRE.T) will be replaced by MEG Energy Corp (Canada, Oil & Gas, MEG.T). The total free-float market capitalization of the reconstituted Dow Jones Canada Titans 60 Index increased to US$1.148 trillion from US$1.143 trillion as of June 13, 2011.
The Dow Jones Canada Titans 60 Index measures the performance of 60 leading stocks traded in Canada.
Further information on the Dow Jones Country Titans Indexes can be found at www.djindexes.com
Rivermark Finds 80.6% of Advisors Agree: “No More Commodity ETFs”
New Study Finds Staggering Number of Advisors Not Considering New Commodity ETFs; Most Cite “Oversaturation” of the Marketplace as the Top Reason
June 14, 2011-A staggering number of Registered Investment Advisors will not recommend new commodity ETFs to their clients, according to a new study released today by Rivermark Research, a privately held research and consulting firm that specializes in demand and competitive intelligence for ETFs and Mutual Funds.
The study, commissioned by a private party, asked RIA respondents whether they believe ETF sponsors should continue to bring new commodity investments to market.
80.6 % of advisors surveyed say new commodity ETFs are unnecessary, with most advisors listing “oversaturation” of the marketplace as the number one reason, followed by “product complexity” and “risk.”
25.2 % of advisors surveyed also believe new ETF products -- outside of commodity funds -- will not serve a purpose in their clients’ portfolios.
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Source: Rivermark Research LLC
"Two Species" Opening Remarks of Commissioner Bart Chilton Before the European Commission
June 14, 2011--Thank you for the invitation to be with you. It is an honor, particularly to be on the panel with Commissioner Barnier.
There are two new species of traders that I believe we need to be cautious about in our markets ecosystem. One, regulators are focusing on and have been discussing, and the other needs heightened attention.
Massive Passives
The massive passives are the first. These speculators, who have invested hundreds of billions into markets in recent years are far out-weighing the traditional commercial speculator and have extremely large—massive—size, along with a fairly price-insensitive—passive—trading strategy. The massive passive trading strategy isn't a secret and others in markets base decisions upon what they know the massive passive will do, which is to go long, by and large. There are more speculative positions in commodity markets than ever before.
I remind folks that we are not a price setting agency. That said, the extreme volatility accompanied by high prices is a concern that needs to be addressed. These markets impact prices consumers pay for just about everything, from a loaf of bread, to a tank of fuel, to a home mortgage. If that price isn't fair, based upon efficient and effective markets, regulators aren't doing the job needed. Quite frankly, we need to do better. We have a requirement in the U.S. to impose position limits. We have, unfortunately, not done so yet, but we will get there.
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Source: CFTC.gov
Opening Statement, Open Meeting to Consider Effective Dates of Provisions in the Dodd-Frank Act
Commissioner Jill E. Sommers
June 14, 2011--Today we are dealing with an issue of great importance to me, providing some certainty to swap market participants concerning the status of their swap transactions on July 16 – the general effective date of Dodd-Frank. First let me say that I intend to vote for this relief because I believe the markets need guidance from the Commission as soon as possible, but I do so reluctantly.
The legal certainty provisions added by the CFMA in 2000 were critical to market participants and I believe that by passing Dodd-Frank and repealing those provisions of the CFMA, Congress in no way intended to decrease the confidence in the markets. Yet that is what has happened. For months I have been talking about the legal uncertainty that would arise on July 16th, and have said that the Commission needed to act sooner rather than later. Market participants have said the same thing. Instead of acting sooner, we are acting later, even though we have all known for many months that despite our best efforts, regulations implementing the new regulatory regime would never be finalized and effective by July 16th.
As a result of waiting until the last minute, we have needlessly allowed uncertainty to mount among market participants. As an example, it has been reported to me that as a result of uncertainty surrounding the applicability of business conduct standards for swap dealers, some swap dealers have already informed their pension fund swap counterparties that as of July 16th they will no longer be able to act as counterparties to pension funds. DCO’s are wondering if they are required to have Chief Compliance Officers in place. This kind of ambiguity is not acceptable.
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Source: CFTC.gov
US derivatives reforms to be delayed till end 2011
June 14, 2011--Derivatives rules are set to be delayed by six months in an effort to quell legal uncertainty around financial reform that some worry could roil markets.
Gary Gensler, chairman of the Commodity Futures Trading Commission, said officials would miss a July 16 deadline to finalise rules stemming from the sweeping Dodd-Frank financial reforms passed last year.
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Source: FT.com
Annual Changes to the NASDAQ OMX Global Auto Index
June 13, 2011-- The NASDAQ OMX Group, Inc. (Nasdaq:NDAQ) announced today the results of the annual evaluation of the NASDAQ OMX Global Auto Index (Nasdaq:QAUTO), which will become effective prior to market open on June 20, 2011.
The following six securities will be added to the Index: Ssangyong Motor Company (003620 KP), Geely Automobile Holdings Limited (175 HK), Sanyang Industrial Co., Ltd. (2206 TT), Yulon Nissan Motor Co., Ltd. (2227 TT), AviChina Industry & Technology Company Limited (2357 HK) and Piaggio & C. S.p.A. (PIA IM).
The Index is designed to track the performance of the largest and most liquid companies engaged in manufacturing of automobiles. The NASDAQ OMX Global Auto Index is evaluated annually in June. For more information about the NASDAQ OMX Global Auto Index, including detailed eligibility criteria, visit https://indexes.nasdaqomx.com/.
As a result of the evaluation, the following security will be removed from the Index:
Chongqing Changan Automobile Co., Ltd. (200625 CS).
Source: NASDAQ OMX
Guggenheim Expands International ETF Suite with High Yield Dividend ETF
June 13, 2011--Guggenheim Funds Distributors, Inc. announced the launch of the Guggenheim ABC High Dividend ETF (NYSE Arca:ABCS - News). The new offering from Guggenheim will seek to replicate the BNY Mellon ABC Index (the “Index”) by providing investors with exposure to high-yielding mature companies from the commodity-rich countries of Australia, Brazil and Canada.
“The global supply of commodity and natural resources is expected to become further constrained such that it will be unlikely to keep pace with global population growth,” explained Scott Minerd, Chief Investment Officer, Guggenheim Partners. “Australia, Brazil and Canada are uniquely positioned as a result of vast commodity deposits. These global supply and demand dynamics are likely to place upward pressure on natural resources and commodity prices, thereby leading to attractive investment opportunities.”
Mr. Minerd believes having access to higher-yielding companies from commodity-rich Australia, Brazil and Canada offers investors a high level of dividend income potential. During inflationary periods in commodity-linked economies, many companies—not just energy and materials producers—tend to flourish as overall profits and employment rise with their country’s export sector.
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Source: Guggenheim
US investors still laggards on climate change, report says
June 13, 2011-- US investors continue to lag behind their counterparts in Europe, Australia and New Zealand when it comes to climate change, according to a joint report by the Institutional Investors Group on Climate Change (IIGCC), the North American Investor Network on Climate Risk (INCR) and the Australia/New Zealand Investor Group on Climate Change (IGCC).
The report shows asset owners and asset managers understand the importance of addressing climate change through their investment practices and are making significant progress in a variety of areas.
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Source: IP&E
Global X Funds SuperDividend ETF (SDIV) Attracts Huge Trading Volume
June 13, 2011--Global X Funds, the New York-based provider of exchange- traded funds (ETFs), today announces that the Global X SuperDividend™ ETF (Ticker: SDIV) is among the 2011 ETF launches that generated the highest trading volume on the first day of trading.
The fund started trading on the NYSE Arca on June 9, 2011 and traded 320,924 shares with a total value of $7,999,710 million. SDIV is the third most traded ETF on the first day of trading out of 161 fund launches thus far for 2011*.
The Global X SuperDividend™ ETF tracks the Solactive Global SuperDividend™ Index, which measures the performance of 100 equally weighted companies that rank among the highest dividend yielding equity securities in the world. The index provider applies certain dividend stability filters. With equal weighting across a diverse group of 100 securities, investors may have less risk exposure in the event that a single company depreciates in price or reduces its dividend.
"Global X Funds received the most innovative North American ETF company prize by both US and European institutions," said Bruno del Ama, chief executive officer of Global X Funds. "The Global X SuperDividend™ ETF may be our most innovative ETF to date and we are pleased to see investors embracing SDIV from day one."
Source: Global X Funds
