Americas ETP News
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U.S. Money Market Funds: Recent Trends in Exposure to European Banks
December 13, 2010--Summary Background
This research study is intended to
provide market participants with
information on MMF exposures
to European banks. It is based on
public filings and does not comment
specifically on Fitch-rated MMFs. As
such, the report does not at present
have any ratings implications.
Because this analysis is based on
aggregated data for the 10 MMFs
sampled, it does not capture
potential differences in exposure
profiles across individual funds.
In light of recent volatility in European sovereign debt markets, there has been a focus on identifying
and sizing the various forms of risk exposure that are either directly linked to or correlated with
sovereigns that have experienced heightened investor concern. Exposures to large, systemically important financial institutions, whose perceived credit risk is closely tied to the ability of the sovereign to provide support, have received particular attention.
A potential channel for eurozone sovereign risk is U.S. money market funds (MMFs), which provide banks with short-term dollar-denominated funding by investing in various banks’ securities including certificates of deposit (CDs) and commercial paper (CP). By analyzing time series data for the 10 largest U.S. prime MMFs (a sample that currently represents $740bn, or roughly 45%, of the $1.7tn U.S. prime fund universe), Fitch Ratings has identified several notable trends regarding U.S. MMFs’ dollar exposure to European banks’ CDs, CP, and bank-sponsored assetbacked CP (ABCP) issuances.
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Source: Fitch Ratings
Horizons AlphaPro Launches Canada's First Floating Rate Bond ETF
December 13, 2010--AlphaPro Management Inc. ("AlphaPro"), manager of the Horizons AlphaPro family of exchange traded funds, has launched Canada's first actively managed floating rate bond exchange traded fund, the Horizons AlphaPro Floating Rate Bond ETF (the "Floating Rate Bond ETF" or "HFR").
The Floating Rate Bond ETF will begin trading today on the Toronto Stock Exchange under the symbol HFR. The sub-advisor to the Floating Rate Bond ETF is Natcan Investment Management Inc. ("Natcan").
The investment objective of the Floating Rate Bond ETF is to generate income that is consistent with prevailing short-term corporate bond yields while stabilizing its market value from the effects of interest rate fluctuations.
The Floating Rate Bond ETF invests primarily in a portfolio of Canadian debt securities and hedges the portfolio's interest rate risk to generally maintain a portfolio duration of less than two years. It may also invest in debt securities of U.S. companies, directly, or through investments in securities of other investment funds, including exchange traded funds. The Floating Rate Bond ETF may use derivatives, including interest rate swaps, to deliver a floating rate of income. To the best of its ability, the Floating Rate Bond ETF will seek to hedge its non-Canadian dollar currency exposure to the Canadian dollar at all times.
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Source: AlphaPro Management Inc.; Horizons AlphaPro ETFs
Global X files with the SEC
December 13, 2010-Global X has filed a post effective amendment, registration statement with the SEC for
Global X Oil Equities ETF.
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Source: SEC.gov
JPMorgan cuts back on US silver futures
December 13, 2010--JPMorgan has quietly reduced a large position in the US silver futures market which had been at the centre of a controversy about its impact on global prices for the precious metal.
The decision by JPMorgan was an attempt to deflect public criticism of the bank’s dealings in silver, a person familiar with the matter said. The person added that the bank’s position in silver would from now on be “materially smaller” than in the past.
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Source: FT.com
iShares JPMorgan Emerging Markets Bond Fund passes USD1bn AUM
December 13, 2010--The iShares JPMorgan USD Emerging Market Bond Fund has surpassed USD1bn in assets under management.
The fund tracks a broad, diverse US dollar denominated emerging market debt benchmark, and is designed to give access to debt instruments from more than 30 emerging market countries in one trade.
The fund is one of iShares’ highest yielding funds and has seen over USD700m in inflows year to date, making it the fifth best performing European iShares product in terms of asset gathering in 2010.
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Source: ETF Express
CFTC.gov Financial Data for Futures Commission Merchants Update
December 10, 2010--Selected FCM financial data as of October 31, 2010 (from reports filed by November 30, 2010) are now available
view update
Source: CFTC.gov
CFTC.gov Commitments of Traders Reports Update
December 10, 2010--The CFTC.gov Commitments of Traders Reports for the for the week of December 7, 2010 are now available.
view updates
Source: CFTC.gov
ProShares Launches First Long/Short RAFI ETF
December 9, 2010 — ProShares, a premier provider of alternative exchange traded funds (ETFs), announced the launch of ProShares RAFI® Long/Short (RALS). The ETF, the first dedicated fund that offers a long/short strategy based on Research Affiliate's pioneering Fundamental Index (RAFI®) methodology, lists on NYSE Arca today.
The RAFI approach uses fundamental measures of company size—sales, dividends, cash flow and book value—instead of security price in selecting and weighting securities. The new ETF seeks to match the performance of the RAFI® US Equity Long/Short Index before fees and expenses. The Index takes long positions in companies with large RAFI weights relative to their capitalization weights and short positions in companies with small RAFI weights relative to their capitalization weights. By allocating an equal dollar amount to its long and short positions, the Index is designed to generate an absolute return over a full market cycle.
"We are pleased to partner with Research Affiliates and Rob Arnott on ProShares RAFI Long/Short," said Michael L. Sapir, Chairman and CEO of ProShare Advisors LLC, ProShares' investment advisor. "This ETF may appeal to investors looking for strategies that strive to deliver low correlation and favorable returns regardless of market direction."
"Lifting the long-only constraint extends the potential benefits of the RAFI approach," said Rob Arnott, founder of Research Affiliates. "We are excited that ProShares is providing access to another important alternative strategy for investors."
Concurrent with the launch of the ProShares RAFI ETF, ProShares is introducing a new marketing campaign with the themeline, “The Alternative ETF Company®." ProShares introduced the industry's first, and today is the world's leading provider of, geared (leveraged and inverse) ETFs. Last year, ProShares introduced ProShares Credit Suisse 130/30 (CSM), the first ETF of its kind. With the introduction of the ProShares RAFI® Long/Short, ProShares continues to demonstrate its commitment to provide investors with ETFs that pursue alternative strategies.
Source: ProShares
FocusShares files with the SEC
December 10, 2010--FocusShares has filed a post effective amendment, registration statement with the SEC for
Focus Morningstar US Market Index ETF
Focus Morningstar Large Cap Index ETF
Focus Morningstar Mid Cap Index ETF
Focus Morningstar Small Cap Index ETF
Focus Morningstar Basic Materials Index ETF
Focus Morningstar Communications Services Index ETF
Focus Morningstar Consumer Cyclical Index ETF
Focus Morningstar Consumer Defensive Index ETF
Focus Morningstar Energy Index ETF
Focus Morningstar Financial Services Index ETF
Focus Morningstar Health Care Index ETF
Focus Morningstar Industrials Index ETF
Focus Morningstar Real Estate Index ETF
Focus Morningstar Technology Index ETF
Focus Morningstar Utilities Index ETF
view filing
Source: SEC.gov
PowerShares Water Resources Portfolio (PHO) Commemorates 5-Year Anniversary
December 9, 2010--nvesco PowerShares Capital Management LLC, a leading provider of exchange-traded funds (ETFs) with more than $50 billion in franchise assets, announced today the five-year anniversary of PowerShares Water Resources Portfolio (NYSE Arca: PHO).
The PowerShares Water Resources Portfolio is the industry’s first water ETF. Listed on Dec. 6, 2005, PHO is the largest and most actively traded ETF providing investors with access to a portfolio of U.S.-listed companies engaged in the water industry and is positioned in a way that seeks to benefit from the rapidly accelerating water resource challenges (Bloomberg LP, as of Dec. 6, 2010).
“The world’s supply of clean water is increasingly in demand for consumption, irrigation and industrial production, and we believe the PowerShares Water Resources Portfolio (PHO) is a compelling way for investors to capitalize on this investment theme,” noted Ben Fulton, Invesco PowerShares managing director of ETFs. “We are pleased with the performance and success of PHO, and remain committed to expanding investors’ access to investment themes, strategies, and asset classes that were previously difficult to reach.”
“That Invesco PowerShares had the insight to pioneer water as an investment is a testament to their leadership in the field. It was truly a unique combination; water as an investment theme packaged in the then relatively new framework of a specialized ETF,” said Steve Hoffmann, designer of the Palisades Water Index.
Consistent with the long-term investment fundamentals of the water industry, the Palisades Water IndexTM underlying PHO gained a cumulative total return of 36.10% over the five-year period, significantly outperforming the S&P 500, which gained a total return of 7.87% during the period as indicated in the chart below. The comparisons are also favorable relative to the cumulative total returns of other major market indexes calculated for the five-year period ending Dec. 3, 2010, which saw the DJIA up 19.81%, the Nasdaq up 32.68%, and the Russell 2000 gaining 17.72%.
visit www.invescopowershares.com for more info.
Source: PowerShares
