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Hedge funds, private equity funds demand confidentiality
March 30, 2011-According to Forbes, recent rules proposed by the Securities and Exchange Commission (SEC) in connection with the Dodd Frank reforms have received strong attention and criticism from hedge funds and private equity funds.
Sponsors and managers of these funds are now required to register with the SEC, and they are requesting that steps be taken by the regulator to protect the confidentiality of the information that is provided. The generous “private adviser” exemption, which permitted many fund managers to remain outside the SEC’s reach regardless of the size of their funds, has now been repealed.
Source: Forbes
Direxion files with the SEC
March 30, 2011--Direxion has filed a post-effective amendment, registration statement with the SEC.
view filing
Source: SEC.gov
iShares Launches a High Dividend Equity Exchange Traded Fund
The New Fund Responds to Investors' Desire for Income-Oriented Products
March 30, 2011--BlackRock, Inc. (NYSE: BLK) today announced that its iShares® Exchange Traded Funds (ETFs) business, the world's largest manager of ETFs, is scheduled to launch the iShares High Dividend Equity Fund (NYSE Arca: HDV) on the NYSE Arca on March 31, 2011. The new fund provides exposure to high quality income-producing U.S. securities.
iShares offers a broad and modular suite of income-focused ETFs, allowing investors to implement dividend investing strategies using diversified and cost-effective vehicles. iShares launched the first US-listed dividend ETF (NYSE Arca: DVY) in 2003.
"Income is in high demand, yet continues to be hard to come by from traditional sources in a cost-effective, diversified, flexible trading manner," said Noel Archard, Head of US Product at iShares at Blackrock. "A basket of high dividend yielding equities can often provide investors with several benefits such as the potential for enhanced total return (especially in uncertain market environments), possible reduced volatility as compared to more growth-oriented stocks, and greater inflation protection than bonds through the ability to provide capital appreciation."
The fund is benchmarked to the Morningstar Dividend Yield Focus Index, which provides access to U.S. equity securities issued by companies that have provided relatively high dividend yields on a consistent basis. Morningstar's proprietary index methodology screens U.S. companies for superior company quality and financial health based on the Morningstar's Economic Moat™ rating system and the Morningstar Distance to Default measure. Economic moat describes the sustainability of a company's future economic profits, and distance to default measures the likelihood that a company may encounter financial distress1. The index provides access to the top 75 companies by dividend yield that meet the eligibility criteria. The top three sectors in the index as of 2/28/11 are Consumer Goods (19.8%), Healthcare (19.1%) and Utilities (17.1%).
Source: BlackRock
Scottrade's FocusShares Launches New Family of 15 Low-Cost ETFs
March 30, 2011--FocusShares, LLC, a registered investment advisor (RIA), exchange-traded fund (ETF) sponsor and affiliate of online investing firm Scottrade, Inc., today launched 15 new low-cost ETFs benchmarked to indexes licensed from Morningstar, Inc. The FocusTM Morningstar ETFs begin trading today on NYSE Arca and are the first investment products sponsored by FocusShares since being acquired in June 2010 by Scottrade Financial Services, Inc., the parent holding company of Scottrade, Inc.
Each FocusTM Morningstar ETF is among the lowest-cost ETFs in its category available today. Online trading of these ETFs will be available commission-free to Scottrade brokerage customers and registered investment advisors using Scottrade® Advisor Services as their custodian. Investors and advisors who are not Scottrade brokerage customers can purchase FocusTM Morningstar® ETFs through their brokerage firms by paying applicable commissions.
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Source: Morningstar
FocusShares Launches 15 New ETFs Linked to Morningstar® Indexes on NYSE Arca
March 30, 2011-- NYSE Euronext (NYX) announced today that FocusShares, LLC, has launched 15 new exchange traded funds (ETFs) on NYSE Arca. FocusTM Morningstar ETFs are benchmarked to indexes licensed from Morningstar, Inc., and are the first investment products sponsored by FocusShares since being acquired by Scottrade Financial Services, Inc., in 2010.
"We are pleased that FocusShares selected our platform to bring their new ETFs to market,” said Laura Morrison, head of NYSE Euronext U.S. ETP listing and trading. “We believe their listing choice underscores the value of the consultative services, market structure and technology that NYSE Arca provides its issuers and the ETF marketplace.”
“This is a great time to launch a new family of ETFs, particularly with the growing demand for ETFs, which hit a record $1 trillion in assets within the past few months,” said Erik Liik, President of FocusShares. “We are proud to list on NYSE Arca today to provide retail and institutional investors as well as financial advisors with low-cost funds based on reliable Morningstar® Indexes that will help them meet their individual investment goals and objectives.”
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Source: NYSE Euronext
Global X Funds Announces Share Split of Global X FTSE Colombia 20 ETF (GXG)
March 30, 2011-
Global X Funds, the New York based provider of exchange traded funds (ETFs), announced today that its Board of Trustees has approved a 2 for 1 split of the shares of the Global X FTSE Colombia 20 ETF (ticker: GXG). GXG's closing price on Monday, March 28, was $40.25.
This split will take place for shareholders of record as of the close of business on April 8, 2011, and will be payable after the close of trading on April 11, 2011. Fund shares will begin trading on a split-adjusted basis on April 12, 2011. Shareholders will see the change in their holdings sometime after that date, depending upon their brokerage firm's procedures.
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Source: GLOBAL X FUNDS
Fundamentals: The Biggest Urban Legend in Finance
March 30, 2011--Stocks ought to produce higher returns than bonds for the capital markets to "work." But stocks have not always produced the 4-5% equity risk premium that many investors expect over long time periods. In fact, if we delve into history, there are long periods where U.S. stocks underperform government bonds. A caution to the wise: A lower forward-looking equity risk premium—and its implicit reduction for stock allocations—might be well-advised.
Ibbotson Associates, whose annual data compendium1 covers U.S. stocks and U.S. bonds since January 1926, shows the S&P 500 Index compounding through
December 2010 at an annual rate of 9.9% vs. 5.5% for long-term government bonds, an excess return of 4.4%. This return compounds exponentially with time. A $1,000 U.S. stock investment in 1926 would have ballooned to $3 million
by December 2010 vs. $92,000 for
an investment in long-term bonds,
a 32-fold difference.
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Source: Research Affiliates
Deutsche Bank and Invesco PowerShares Launch First Exchange Traded Notes Linked to Foreign Sovereign Bond Futures
March 30, 2011--Deutsche Bank and Invesco PowerShares Capital Management, LLC today announced the launch of six Exchange Traded Notes (ETNs) linked to the foreign sovereign bond futures. These will be the first ETNs to provide investors with leveraged or unleveraged exposure to the U.S. dollar value of the returns of German sovereign bond futures, Italian sovereign bond futures and Japanese sovereign bond futures. These ETNs expand upon Deutsche Bank’s product line-up that already includes leveraged ETNs linked to US Ultra T-Bond Futures.
The ETNs will be listed for trading on the NYSE Arca, under the following symbols:
PowerShares DB German Bund Futures ETN:(NYSE Arca: BUNL)
PowerShares DB 3x German Bund Futures ETN: (NYSE Arca: BUNT)
PowerShares DB Italian Treasury Bond Futures ETN: (NYSE Arca: ITLY)
PowerShares DB 3x Italian Treasury Bond Futures ETN: (NYSE Arca: ITLT)
PowerShares DB Japanese Govt Bond Futures ETN: (NYSE Arca: JGBL)
PowerShares DB 3x Japanese Govt Bond Futures ETN: (NYSE Arca: JGBT)
The ETNs are senior unsecured obligations issued by Deutsche Bank AG, London Branch. The returns of each ETN are obtained by combining the month-over-month performance or three times the month-over-month performance of the DB USD Bund Futures Index, the DB USD BTP Futures Index or the DB USD JGB Futures Index, as applicable, with the monthly returns of the DB 3-Month T-Bill Index, less an investor fee.
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Source: Deutsche Bank
Bloomberg Facilitates Execution & Clearing of CDS & IRS E-Trades
J.P. Morgan executes trades with multiple firms on FIT Platform
March 30, 2011--Bloomberg executives today announced that J.P. Morgan electronically executed and cleared credit default swap (CDS) and interest-rate swap (IRS) trades on Bloomberg's Fixed Income Electronic Trading platform (FIT).
The trades demonstrate that Bloomberg's Fixed Income business is preparing to meet the broadly defined requirements of the Dodd-Frank Act, which calls for increased transparency and market efficiency in over-the-counter (OTC) derivatives trading. Bloomberg intends to register with the U.S. Commodity Futures Trading Commission (CFTC) and the U.S. Securities and Exchange Commission (SEC) as a Swap Execution Facility (SEF) and Security Based Swap Execution Facility (SBSEF), respectively.
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Source: Bloomberg
"Whistling"
Remarks of Commissioner Bart Chilton to Taxpayers Against Fraud (TAF), New York, New York
March 30, 2011--Introduction
It is good to be with all of you this afternoon. I appreciate that we are able to join together through the magic of technology. I know many of you aren't located in the cities where most of our financial regulatory work occurs: Washington, New York and Chicago. That makes it all the more refreshing to be able to talk with folks in many parts of the country. That is, in addition to those of you in the cities I named.
When I hear about groups doing good work, whose mission it is to work every day for a noble cause, I get a little Pollyannaish myself. That is, I want to look for the good and positive things that can be done. I know you all strive to do good work and I commend you for it, not that you need to hear it from a government regulator. We do, however, share some common goals. I like to think that people in government are in that group seeking good, although on the whole, we don't hit the mark as often as we should.
Regulatory Challenges
Today, I want to focus on just one issue. To be candid, it is a pleasure to talk about a single issue. We have over 40 rulemakings going on at the CFTC. Our brethren regulator, the Securities and Exchange Commission, has many more. We've all been very busy trying to come up to speed on issues, review and publish proposals, consider comments, and then if we feel comfortable—like we got it right—go final on rules and regulations. Talking about the logistics of the process is easy, however. Moving through it is another matter.
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Source: CFTC.gov
