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U.S. House Democrat Barney Frank and Massachusetts Democrat Michael Capuano introduced a bill-would combine the SEC and CFTC
November 30, 2012--U.S. House Democrat Barney Frank and Massachusetts Democrat Michael Capuano introduced a bill that would combine the Securities and Exchange Commission and Commodity Futures Trading Commission.
Status: Referred to Committee
EPFR Global Fund Data News Release-US equity fund inflows best in more than a year
November 30, 2012--A burst of optimism about the likelihood of US lawmakers cobbling together some kind of budget deal before a raft of spending cuts and tax increases kick in, saw investor attention shift from the world's second largest economy, China, to the biggest.
During the fourth week of November EPFR Global-tracked US Equity Funds attracted over $10 billion in net inflows, their best showing in more than a year, as flows into China Equity Funds slipped to a seven week low.
This optimism also boosted appetite for riskier asset classes. Flows into Emerging Markets Equity Funds hit a 10 week high while both High Yield Bond and Alternative Funds snapped two week outflow streaks.
Overall, EPFR Global-tracked Equity Funds recorded inflows of $14.86 billion during the week ending Nov. 28 -- their second highest total year-to-date -- while Bond Funds took in a net $5.17 billion and Money Market Funds $5.87 billion.
Visit http://www.epfr.com/overview.aspx for more info
Bond Market Liquidity Risk a Primary Concern for US Fixed-Income Markets, Says TABB
New Models and Products Emerge as Electronic Trading Grows and Single-Name CDS Declines
November 30, 2012--Quantitative easing (QE), reduced trading revenues and bank regulations are colliding to reshape the US fixed-income markets, according to TABB Group in new research, "US Fixed Income Trends: State of the Industry 2012."
"The old business model of dealers holding bond inventory is dead," reports Henry Chien, a TABB research analyst who co-authored the report with contributing analyst Deepali Nigam. “New platforms and products in today’s credit bubble are driving new liquidity dynamics.”
Brazil adds to emerging market slowdown
November 30, 2012--Brazil's hopes of returning to the club of high-growth emerging markets were dealt a blow on Friday following the release of figures that showed the economy is on track for one of its slowest years in a decade.
Gross domestic product grew only 0.6 per cent in the third quarter over with the second – in spite of a prediction this week from Guido Mantega, finance minister, that it had expanded at twice this rate – setting Brazil on course for growth of just 1 per cent in 2012.
CFTC's Division of Market Oversight Issues Time-Limited No-Action Relief Concerning Bespoke or Complex Swaps
November 30, 2012--The Commodity Futures Trading Commission's (CFTC) Division of Market Oversight (DMO) today announced the issuance of a time-limited no-action letter granting relief, for bespoke or complex swaps, from certain reporting obligations under Part 43 and Part 45 of the Commission's regulations.
For bespoke or complex swaps as defined therein, the no-action letter provides that DMO will not recommend an enforcement action against (1) a reporting party
CFTC's Division of Swap Dealer and Intermediary Oversight Issues No-Action for Family Offices
November 30, 2012--The Commodity Futures Trading Commission's (CFTC) Division of Swap Dealer and Intermediary Oversight (DSIO) today issued a no-action letter regarding family offices.
The letter states that DSIO will not recommend that the CFTC take enforcement action against the operators of family offices for failure to register as commodity pool operators under the Commodity Exchange Act and the CFTC’s regulations, subject to certain conditions described in the letter.
Tax surprise could hit bond ETF investors
Firms tout funds' tax efficiency, but is their word their bond?
November 30, 2012--With tax changes looming in Washington, investors sitting on market gains have been struggling to decide whether to pay now or risk higher rates later. But holders of some fixed-income exchange-traded funds may not fully control that decision
While exchange-traded funds have long been marketed for their tax benefits, this year a slew of bond funds from top providers including Vanguard Group, Pacific Investment Management Co. and iShares could oblige fund holders to pay capital gains taxes on a slice of their investments — even if they simply hold onto the funds.
Market Vectors ETFS Offers Six Additional Exchange-Traded Funds To Qualified Investors In Mexico
November 29, 2012--Market Vectors ETFs, the fifth largest provider of exchange-traded products in the U.S. and the eighth largest provider of ETPs globally, announced today that it has added six NYSE Arca-traded ETFs to the growing list of depository receipts based on Market Vectors ETFs currently available to Qualified Investors in Mexico.
Deutsche Securities Casa de Bolsa in Mexico will act as local sponsor and filing agent for depositary receipts on the following ETFs:
Market Vectors High-Yield Municipal Index ETF (Ticker: HYD) Assets under management1: USD924.4 M 30-day average daily trading volume1,2: 259 thousand shares
Market Vectors Intermediate Municipal Index ETF (Ticker: ITM) Assets under management1: USD641.6 M 30-day average daily trading volume1,2: 185 thousand shares
Market Vectors Long Municipal Index ETF (Ticker: MLN) Assets under management1: USD106.6 M 30-day average daily trading volume1,2: 37 thousand shares
Market Vectors Morningstar Wide Moat Research ETF (Ticker: MOAT) Assets under management1: USD63.4 M 30-day average daily trading volume1,2: 39 thousand shares
IMF Working paper-Nonfinancial Firms in Latin America: A Source of Vulnerability?
November 29, 2012--Summary: We examine corporate sector vulnerabilities in Brazil, Chile, Colombia, Mexico and Peru. First, we identify stylized facts based on corporate financial indicators.
Second, we assess vulnerability of individual firms to a sudden stop in financing through a probit model, using a panel of 18 countries in 2000-11. Results suggest that higher leverage and maturity exposures raise a firm’s probability to become exposed to a funding shock, while a larger firm size and buffers reduce it. Further, greater exchange rate flexibility can help mitigate corporate vulnerability. Identification of firms at risk through the model suggests that some vulnerabilities may be building in Latin America led by leverage, currency exposures and moderating buffers. These effects are partially offset, however, by a significant reduction in maturity exposures.
view the IMF Working paper-Nonfinancial Firms in Latin America: A Source of Vulnerability?
With Knight In Play, ETF Trade Will Be OK
November 29, 2012--You might think that having Knight Capital in play could be a threat to ETF trading. Luckily it's not.
Still, it struck me that thinking through the possibilities surrounding an acquisition of Knight by Getco or Virtu is a worthwhile exercise.
After all, Knight is the biggest ETF market maker out there,
Knight Surges on Takeover Bids From Getco, Virtu
November 29, 2012--Knight Capital Group Inc. (KCG) capped its biggest rally in nine years after getting takeover offers from Getco LLC and Virtu Financial LLC, setting up a bidding war that may end its 17-year history as an independent company.
Getco’s cash and stock offer values Knight at $3.50 a share, an 18 percent premium from the Nov. 27 close, and retains its public listing, according to a filing yesterday from the Chicago-based high-frequency trader. Virtu submitted a bid to buy Knight for about $3 a share, a person with direct knowledge of the matter said. Another person familiar said the company’s offer was made yesterday. Knight was bailed out by six financial companies in August after losing more than $450 million in a trading malfunction.
Who Benefits From ETFs In 529 Plans?
November 29, 2012--Exchange traded funds (ETFs) have taken the financial industry by storm over the last few years as investors have flocked to the fund type.
Blending the line between traditional indexing and active trading, investors have poured more than $1.1 trillion into roughly 1,251 different funds since their creation in 1993, according to data from State Street. Much of this growth has come at the cost of traditional mutual funds, which continue to see outflows.
Faced with shrinking contributions and meager returns, ETFs are now making inroads into 529 college savings vehicles and 401(k) retirement plans as administrators hope to make up for the market's recent poor performance and volatility.
For the countless parents who have joined such plans in order to help pay for their children's future college expenses, the question remains, are there any real benefits to adding the security type to their plans?
BlackRock: Ahead of the Street
November 29, 2012--Larry Fink was once a prince of Wall Street. In the 1980s he became the youngest managing director ever at First Boston, where he was a pioneer in the mortgage bond market.
He might have been fitted for the crown at the investment bank, now owned by Credit Suisse, but in 1986 his mortgage department lost $100 million in a single quarter. Two years later he was out.
Today, as the head of BlackRock [BLK 197.04 1.42 (+0.73%) ] – the world’s largest asset manager, with $3.7 trillion in assets – Mr Fink is at the pinnacle of US finance. But do not suggest that he is a Wall Street chieftain. Mr Fink has long defined himself as an anti-Wall Street figure.
CBOE Holdings To Transition SPXpm From C2 To Hybrid Trading On CBOE
Move to Consolidate the Company's S&P 500 (SPX) Product Line on a Single Exchange and Increase Access to SPXpm
November 29, 2012--CBOE Holdings (NASDAQ: CBOE) announced plans today to transition its SPXpm product from the company's all-electronic C2 Options Exchange (C2) to Chicago Board Options Exchange (CBOE), where it will be traded on CBOE's hybrid trading model which incorporates both electronic and open outcry trading.
The transition will consolidate the company's entire S&P 500 options product line on one exchange, CBOE.
The company's pm-settled SPX options (including SPXpm, SPX Weeklys and SPX Quarterlys) will trade in CBOE's hybrid environment under ticker "SPXPM." Its flagship SPX option, which is a.m.-settled, will continue to trade in CBOE's open outcry environment under ticker "SPX." The migration of SPXpm from C2 to CBOE is expected to result in increased access and liquidity by exposing the product to an even broader user base.
DB-Synthetic Equity & Index Strategy-North America-US ETF Model Portfolios-House View Portfolio Update
November 29, 2012--Adding China exposure and cutting on Dividend and Gold exposures
Market Performance
Since the launch of our House View portfolio (HVP) on October 2, 2012, the US equity market (SPY) has dropped by 2.0%, the broad US Fixed Income market (BND) has been nearly flat at +0.1%, and the Commodity market (DBC) has lost 2.89%
Model Performance
Our HVP is down by 0.79% since its launch. However this is still higher than the equity market and our multi asset class benchmark which are down by 2.0% and 1.55%, respectively.
Portfolio Updates and New Membership
We added a new satellite long position on China (MCHI) with a weight of 10%. The weight for this new position will be funded by reducing the target weight for the US Dividend and the Gold positions by 5% each.
