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DB-Synthetic Equity & Index Strategy-North America-ETF+ Monthly Directory-December 2012
January 15, 2013--This document includes all US listed exchange-traded funds (ETFs) and exchange-traded vehicles (ETVs), plus a special section covering exchange-traded notes (ETNs).
The directory is organized by asset class and asset-class-related sub sections. Within each sub section it has also been sorted. For Equity and Fixed Income ETPs it is sorted by country (or sub region for regional products) in alphabetical order and by AUM in descending order, and for the other ETP asset classes it is sorted by sub sector in alphabetical order and by AUM in descending order. A number of key information points per product has been included in order to enable the reader to get an overview in their respective area of interest. Among the key numeric information we include avg. daily turnover, assets under management, and cash flows (all in $US).
WisdomTree EM Equity Income ETF Tops $5B in AUM
January 15, 2013--The WisdomTree Emerging Markets Equity Income Fund (DEM) is continuing an impressive asset-gathering run that started in earnest in early 2012.
WisdomTree (WETF) said in a statement that DEM recently crossed the lofty $5 billion in assets under management threshold.
To put that total in perspective, it was in late February 2012 that WisdomTree was touting the fact that DEM had topped $3 billion in AUM.
PowerShares DWA Technical Leaders ETFs
PowerShares DWA Technical Leaders ETFs Assets Increase over 50% in 2012
January 15, 2013--Invesco PowerShares Capital Management LLC, a leading global provider of exchange-traded funds (ETFs), announced today the PowerShares DWA Technical Leaders family of ETFs recently surpassed $1 billion in total assets.
PowerShares DWA Technical Leaders ETFs, based on the Dorsey Wright & Associates (DWA) relative strength index methodology, were among the first factor-driven ETFs available in the U.S. marketplace.
PowerShares DWA Technical Leaders Strategies:
PDP-PowerShares DWA Technical LeadersTM Portfolio
PIE -PowerShares DWA Emerging Markets Technical Leaders Portfolio
PIZ-PowerShares DWA Developed Markets Technical Leaders Portfolio
DWAS PowerShares DWA SmallCap TechnicalTM Leaders Portfolio
“We are very pleased to celebrate the PowerShares DWA Technical Leaders ETFs' $1 billion AUM milestone,” said Ben Fulton, Invesco PowerShares managing director of Global ETFs. “Dorsey Wright is one of the foremost experts in Relative Strength strategies, which are well-suited for the ETF structure. Asset growth for the PowerShares DWA Technical Leaders ETFs accelerated in 2012, and having achieved such a positive performance track record, we would expect that trend to continue.”
Global X Funds Launches First Junior MLP ETF (MLPJ)
January 15, 2013--Global X Funds,, the New York based provider of exchange traded funds (ETFs), today launched the Global X Junior MLP ETF (MLPJ).
MLPJ is the first and only ETF to specifically target the often overlooked small-cap segment of the MLP market.
As the energy infrastructure in North America continues to expand, smaller capitalization MLPs often control increasingly important energy assets and are active in the exploration, transportation and storage of domestic energy resources. Because many of these companies are not included in major MLP indices, in many cases they have not experienced the same price growth as their larger counterparts and may offer value at current levels.
According to a 2012 report from the International Energy Association, the U.S. will become the world’s largest oil producer by 2017 and a net exporter of natural gas by 2020. Junior MLPs are poised to benefit from the U.S. energy renaissance, providing critical infrastructure for the exploration and production, transportation and storage of this increase in domestic energy and offering investors a means to access this growth. Despite a difficult IPO market, four energy-related MLPs have made their IPO debuts in 2012 alone, as the smaller-cap segment of the industry continues to expand.
iShares files with the SEC
January 15, 2013--iShares has filed a post-effective amendment, registration statement with the SEC for the iShares 2018 Investment Grade Corporate Bond ETF.
view filing
BNY Mellon DR Indices Monthly Performance-December 2012
January 15, 2013--The BNY Mellon DR Index Monthly Performance Review December 2012 is now available.
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Financial Data for Futures Commission Merchants Update
January 14, 2013--Selected FCM financial data as of November 30, 2012 (from reports filed by January 02, 2013) is now available.
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Horizons ETFs launches Active S&P/TSX 60(TM) Covered Call ETF
January 14, 2013--Horizons Exchange Traded Funds Inc. ("Horizons ETFs") and its affiliate AlphaPro Management Inc. ("AlphaPro") are pleased to announce the launch of the Horizons Active S&P/TSX 60(TM) Index Covered Call ETF ("HAX" or the "ETF"), an exchange traded fund that uses an innovative covered call strategy to generate additional income from the option eligible stocks comprising the S&P/TSX 60(TM) Index.
The ETF will begin trading on the Toronto Stock Exchange tomorrow under the symbol HAX.
The investment objective of HAX is to provide Unitholders with: (a) exposure to the performance, to the extent possible, of the S&P/TSX 60™ Index, together with the impact of a covered call strategy, before fees and expenses; and (b) monthly distributions of dividend and call option income.
Morgan Stanley-US ETF Weekly Update
January 14, 2013--Weekly Flows: $2.4 Billion Net Inflows
ETF Assets Stand at $1.4 Trillion, up 3% YTD
No ETF Launches Last Week
Vanguard Begins VWO Index Transition; Changes ETF Name
New Benchmarks for Two Van Eck ETFs
US-Listed ETFs: Estimated Flows by Market Segment
ETFs posted net inflows of $2.4 bln last week, the 8th consecutive week of net inflows
Net inflows were led by US Sector & Industry and International Equity ETFs, helping to offset outflows from US-Large Cap ETFs
After four consecutive weeks of net outflows, Fixed Income ETFs posted net inflows of $0.5 bln last week
ETF assets stand at $1.4 tln, up 3% YTD
13-week flows were mostly positive among asset classes; combined $69.1 bln net inflows
International Equity ETFs have exhibited net inflows of $29.4 bln over the past 13 weeks (62% into EM Equity ETFs)
Over the last 13 weeks, Leveraged/Inverse ETFs posted the largest net outflows of any category ($1.1 bln)
Despite the demand for income, US Dividend Income ETFs have had net outflows of $0.2 bln over the last 13 weeks
US-Listed ETFs: Estimated Largest Flows by Individual ETF
The Financials Select Sector SPDR (XLF) posted net inflows of $0.8 bln last week, the most of any ETF
This is the fourth consecutive week of net inflows for XLF (combined net inflows of $1.8 bln) and last week’s net inflows were its largest since the week ending March 16, 2012, when it posted net inflows of $1.0 bln
The SPDR S&P 500 ETF (SPY) had net outflows of $3.1 billion last week, the most of any ETF; prior to last week, SPY had posted net inflows for 7 consecutive weeks (combined net inflows of $25.7 billion over the period)
Over the last 13 weeks, the iShares MSCI Emerging Markets Index Fund (EEM) has the highest net inflows among all ETFs at $11.5 bln, accounting for almost 60% of the net flows into emerging market ETFs over the period
US-Listed ETFs: Short Interest Data Updated: Based on data as of 12/31/12
iShares Russell 2000 Index Fund (IWM) had the largest decline in USD short interest at $2.1 bln
IWM’s shares short are their lowest level since October 15, 2009
Interestingly, the Market Vectors Gold Miners ETF (GDX) exhibited the third largest increase in short interest while the SPDR Gold Trust (GLD), which holds the physical metal, had the second largest decline in short interest
Aggregate ETF USD short interest decreased by $70 mln over the past two weeks ended 12/31/12
The average shares short/shares outstanding for ETFs is currently 5.3%
Smaller ETFs by market cap may skew results (three of the top 10 with the highest % of shares short have market caps <$5 mln)
Retail ETFs consistently are some of the most heavily shorted ETFs (shares short as a % of shares outstanding)
Based on multiple borrowings and the ability to continuously create new shares, shares short as a % of shares outstanding can exceed 100% (only seven ETFs exhibited shares short as a % of shares outstanding greater than 100%)
US-Listed ETFs: Most Successful Recent Launches by Assets
Source: Bloomberg, Morgan Stanley Smith Barney Research.
Data estimated as of 1/11/13 based on daily change in share counts and daily NAVs.
$9.5 billion in total market cap of ETFs less than 1-year old
Newly launched Active ETFs account for 47% of the market cap of ETFs launched over the past year; PIMCO Total Return ETF (BOND) is the largest actively managed ETF with a market cap of $3.9 bln
No new ETF listings and 16 announced closures YTD
The top 10 most successful launches make up 72% of the market cap of ETFs launched over the past year
Five different ETF sponsors and two asset classes represented in top 10 most successful launches
The iShares Core MSCI Emerging Markets ETF (IEMG) posted net inflows of $94 mln last week, the most of any recently launched ETF
Five out of the top 10 most successful ETF launches over the past year invest in international equities and fixed income as new
ETF launches have increased the accessibility of these markets
SEC in landmark ruling on Nasdaq plan
January 14, 2013--The Securities and Exchange Commission has rejected a move by Nasdaq OMX to provide brokerages with a certain type of new stock order, marking the first time the market regulator has disapproved of such computerised trading tools.
The unprecedented decision by the SEC points to the growing regulatory scrutiny of exchanges amid an industry outcry over conflicts of interest in the share trading business.
Finra Lets Brokers Know of Trouble Areas .
January 14, 2013--Brokers recommending business development companies and leveraged loan products may want to tread a little more cautiously.
The investments top the Financial Industry Regulatory Authority's list of potentially unsuitable products for 2013.
Finra outlines its priorities at the start of each year in a letter to the broker-dealer firms it oversees. The firms scrutinize it closely, and often put their own spotlight on advisers' dealings in areas that are singled out as potentially problematic.
T. Rowe Price, Legg Mason get approval to launch active ETFs
Analyst expects new products from Baltimore money managers this year
January 14, 2013--Baltimore-based money managers T. Rowe Price and Legg Mason Inc. may offer actively managed exchange-traded funds after receiving a thumbs up from regulators.
The Securities and Exchange Commission approved Price's application earlier this month to be allowed to issue active ETFs — the first, and most difficult, regulatory hurdle to entering the market.
John Hancock files with the SEC
January 14, 2013--John Hancock has filed a fourth amended and restated application for exemptive relief with the SEC-actively-managed ETFs.
view filing
CFTC Grants Order to ICE Clear Credit Permitting Portfolio Margining of Swaps and Security-Based Swaps in a Cleared Swaps Customer Account
January 14, 2014-- Today the Commodity Futures Trading Commission issued an order granting a request made by Ice Clear Credit LLC (ICC), a Commission-registered derivatives clearing organization (DCO), pursuant to Section 4d(f) of the Commodity Exchange Act (Act).
The order sets forth terms and conditions under which ICC and its clearing members that are dually registered as futures commission merchants and broker-dealers may (1) hold credit default swaps (CDS) and security-based CDS in a cleared swaps customer account subject to Section 4d(f) of the Act; and (2) portfolio margin such CDS and security-based CDS held in the cleared swaps customer account.
FINRA-2013 Regulatory and Examination Priorities Letter
January 11, 2013--Each year, FINRA publishes its regulatory and examination priorities to highlight areas of significance to our regulatory programs. These priorities represent our current assessment of the key investor protection and market integrity issues on which we will focus in the coming year.
Since business and regulatory environments are fluid, FINRA continually assesses new risks and integrates them into the scope of its regulatory programs.
Business Conduct and Sales Practice Priorities
FINRA recognizes that retail investors have been challenged to find attractive returns within their risk tolerance. The current slow growth, low-interest-rate environment leaves retail investors
particularly vulnerable. Central bank purchases and investors’ efforts to lower balance sheet risk and shift assets to safer investments have contributed to an unprecedented compression of credit risk premiums and yields in the United States.1 At the same time, retail investors are increasingly shifting funds from equity to debt markets.
Investor appetite for yield, among other factors, has bid up market prices on investment-grade and high-yield debt, putting pressure on upside growth potential and creating significant downside risks. In this environment, FINRA is particularly concerned about sales practice abuses, yield-chasing behaviors and the potential impact of any market correction, external stress event or market dislocation on market prices.
Against this background, we intend to focus our examination efforts on the following areas.
Suitability and Complex Products-FINRA’s recently revised suitability rule (FINRA Rule 2111) requires broker-dealers and associated persons to have a reasonable basis to believe a recommendation is suitable for a customer. Given the market conditions discussed above, we are particularly concerned about firms’ and registered representatives’ full understanding of complex or high-yield products, potential failures to adequately explain the risk-versus-return profile of certain products, as well as a disconnect between customer expectations and risk tolerances.
More specifically, we are concerned about:
XX the market risk exposures associated with interest-rate-sensitive investments and the corresponding alignment with customer risk tolerances given today’s low-yield environment;
XX credit risk exposures associated with investments where the creditworthiness of counterparties
may not necessarily be transparent to or align with the risk tolerance of customers; and
XX liquidity risk exposures associated with investments where the timing of cash flows or the ability to quickly liquidate positions may not align with customer cash flow needs.
