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Long Term Bond Managers Saw Sunny Skies While Most Equity Managers Were In A Fog in 2Q12.
The Forecast Looks Promising for Managed ETFs.
August 22, 2012--
After an exceptional first quarter where 98% of the products in PSN experienced a positive return, the weather shifted in second quarter. Returns were dampened and just 27% of the products produced positive returns.
The news isn’t all bad. Long bonds performed extremely well and a number of equity and balanced managers experienced outstanding performance due to their smart choices. Those top performing managers are this quarter’s PSN Top Guns.
NISA Investment Advisors had three products in the top ten for Long Term Bonds. Their 15+ Year Strip product led the pack by achieving a 17.14% return while their LD Government Only product ranked second with 16.51% return. In addition, the product raked in over $1 Billion in new flows this quarter. Talk about timing!
Equities struggled in second quarter, but some managers found their way through the minefields. Federated Investors, Schafer Cullen and Wilson/Bennett Capital were the top three Large Cap Value performers with respective returns of 4.22%, 3.78% and 3.17%.
Managed ETF products are growing! Our PSN Top Gun winner for US Balanced products is Good Harbor with a one year return of 14.55%. Investors are taking notice with over $1 Billion in new flows this year.
Emerging Markets experienced many dramatic up and down swings over the last few years. The best managers show consistently good returns in both up and down markets – those managers are awarded PSN Top Guns Bull & Bear Masters status. This quarter, the award goes to Wasatch Advisors for their Emerging Markets Small Cap product which had a three year return of 27.40% and navigated the up and down markets better than any other Emerging Markets product. Two Aberdeen Asset products, JP Morgan and AGF Investments rounded out the top five.
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Minutes Of The Federal Open Market Committee, July 31-August 1, 2012
August 22, 2012--The Federal Reserve Board and the Federal Open Market Committee on Wednesday released the attached minutes of the Committee meeting held on July 31-August 1, 2012.
The minutes for each regularly scheduled meeting of the Committee ordinarily are made available three weeks after the day of the policy decision and subsequently are published in the Board's Annual Report. The descriptions of economic and financial conditions contained in these minutes are based solely on the information that was available to the Committee at the time of the meeting.
view the Minutes of the Federal Open Market Committee-July 31-August 1, 2012
Statement of SEC Chairman Mary L. Schapiro on Money Market Fund Reform
August 22, 2012--Securities and Exchange Commission Chairman Mary Schapiro today made the following statement:
Three Commissioners, constituting a majority of the Commission, have informed me that they will not support a staff proposal to reform the structure of money market funds. The proposed structural reforms were intended to reduce their susceptibility to runs, protect retail investors and lessen the need for future taxpayer bailouts.
together with many other regulators and commentators from both political parties and various political philosophies -- consider the structural reform of money markets one of the pieces of unfinished business from the financial crisis.
SEC Adopts Rule for Disclosing Use of Conflict Minerals
August 22, 2012--The Securities and Exchange Commission today adopted a rule mandated by the Dodd-Frank Wall Street Reform and Consumer Protection Act to require companies to publicly disclose their use of conflict minerals that originated in the Democratic Republic of the Congo (DRC) or an adjoining country.
The regulatory reform law directed the Commission to issue rules requiring certain companies to disclose their use of conflict minerals that include tantalum, tin, gold, or tungsten if those minerals are “necessary to the functionality or production of a product” manufactured by those companies. Companies are required to provide this disclosure on a new form to be filed with the SEC called Form SD.
S&P Dow Jones Indices Announces Changes To The S&P/TSX Canadian Indices - A Special Cash Distribution In The S&P/TSX Venture Indices
August 22, 2012--S&P Canadian Index Services will make the following changes in the S&P/TSX Canadian Indices:
On August 21, 2012, Pan Orient Energy Corp. (TSXVN:POE) announced shareholder approval for a capital reorganization.
As part of the reorganization, shareholders will receive a $CDN0.75 special distribution per common share which will be a return of capital. The ex-date for the special distribution will be Tuesday, August 28, 2012. The close price of Pan Orient Energy on Monday, August 27, 2012, will be reduced by $CDN0.75 and new divisors will be generated for the S&P/TSX Venture 30, Venture Select and Venture Composite Indices.
SEC Adopts Rules Requiring Payment Disclosures by Resource Extraction Issuers
August 22, 2012--The Securities and Exchange Commission today adopted rules mandated by the Dodd-Frank Wall Street Reform and Consumer Protection Act requiring resource extraction issuers to disclose certain payments made to the U.S. government or foreign governments.
The regulatory reform law directed the Commission to issue these rules requiring companies engaged in the development of oil, natural gas, or minerals to disclose the information annually by filing a new form with the SEC called Form SD.
A resource extraction issuer is required to comply with the new rules for fiscal years ending after Sept. 30, 2013. The form must be filed with the SEC no later than 150 days after the end of its fiscal year.
Swaps profits threatened by Dodd-Frank
August 22, 2012--Wall Street is preparing for a dramatic overhaul of how derivatives are traded in a move that could hit profits at the big banks.
In anticipation, the banks that act as big swap dealers are tackling their cost base, investing in more technology and adjusting to the prospect of using less leverage, taking less risk and by extension harvesting smaller bonuses.
iShares files with the SEC-iShares Ultrashort Duration Bond Fund
August 21, 2012--iShares has filed a amendment no.1 to form N-1A with the SEC for the iShares Ultrashort Duration Bond Fund.
view filing
Risk of US double-dip recession rises: S&P
August 21, 2012--The odds the United States will slip back into recession next year have risen, ratings agency Standard & Poor's said, citing risks from the European debt crisis and budget tightening at year-end.
The US ratings firm raised the chance of the US falling into recession to 25 percent, up from a 20 percent chance estimated in February, as the world's largest economy struggles to recover from a severe 2008-2009 slump.
It also pointed to the looming possibility of the government being forced by existing law to severely cut spending and increase taxes on January 1, the so-called fiscal cliff that would crunch the economy.
CFTC Announces Website for Market Participants to Register for CFTC Interim Compliant Identifiers (CICI)
August 21, 2012--The Commodity Futures Trading Commission (CFTC) today announced the launch of a website for market participants to register for CFTC Interim Compliant Identifiers (CICI).
CICIs are interim legal entity identifiers (LEI), which will be used by registered entities and swap counterparties in complying with the CFTC’s swap data reporting regulations. On July 24, 2012, the Commission designated DTCC-SWIFT as the provider of CICIs.
Market participants who are required to obtain a CICI to comply with the Commission’s swap data reporting regulations can now do so through the new CICI website: http://www.ciciutility.org. The website, which is free and publicly available, is owned, managed and operated by DTCC-SWIFT.
DB-Equity Derivatives and Quantitative Strategy Research-North America-US ETF Market Weekly Review: ETP assets continue to trend higher
August 21, 2012--Net Cash Flows Review
Markets moved higher during last week. The US (S&P 500) edged higher by 0.87%. While, outside the US, the MSCI EAFE (in USD) rose by 0.90% and the MSCI EM (USD) dropped by 0.81%.
Moving on to other asset classes, the 10Y US Treasury Yield rose by 16bps last week; while the DB Liquid Commodity Index was up by 0.84%. Similarly, the Agriculture sector (DB Diversified Agriculture Index) pulled back by 0.41% and the WTI Crude Oil rose 3.38%, while Gold and Silver prices retreated by 0.26%, and 0.13%, respectively. Last but not least, Volatility (VIX) dropped by 8.75% during the same period.
The total US ETP flows from all products registered $0.6bn of inflows during last week vs. a similar amount of inflows the previous week, setting the YTD weekly flows average at +$2.7bn (+$88.5bn YTD in total cash flows).
Equity, Fixed Income, and Commodity ETPs experienced flows of -$0.5bn, +$0.3bn, and +$0.8bn last week vs. -$0.2bn, +$0.5bn, and +$0.3bn previous week, respectively.
Within Equity ETPs, small cap products experienced the largest inflows (+$0.3bn); while large cap products had the largest outflows (-$1.7bn). Within Fixed Income ETPs, corporate products had the largest inflows (+$0.5bn); while sovereign ETPs experienced the only outflows (-$0.4bn). Within Commodity ETPs, precious metals products experienced the largest inflows (+$0.8bn), while the other sectors experienced less relevant flows.
Top 3 ETPs & ETNs by inflows: GLD (+$0.9bn), IWM (+$0.3bn), XLK (+$0.3bn) Top 3 ETPs & ETNs by outflows: SPY (-$1.5bn), DIA (-$0.3bn), XLI (-$0.3bn)
New Launch Calendar: income and emerging markets
There were 4 new ETFs listed during last week. Two were listed in the NASDAQ Exchange while the other two were listed on the NYSE Arca. The new products offer access to emerging market themes and income generating strategies.
Turnover Review: floor activity decreased by 2%
Total weekly turnover decreased by 2% to $188bn vs. $192bn in the previous week. Last week’s turnover level was 50% below last year’s weekly average. Equity ETPs experienced a decrease of $5.4bn or -3.2% to $162bn. In the meantime, Fixed Income and Commodity ETPs turnover rose by 3.4% (+$0.5bn) and 12.6% (+$1.0bn), respectively.
Assets Under Management (AUM) Review: assets rose by 0.5%
Positive markets drove ETP assets up by 0.5%, ending the week at $1.22 trillion. As of last Friday, US ETPs have accumulated an asset growth of 16.2% YTD. Assets for equity, fixed income and commodity ETPs moved +$0.7bn, -$0.4bn, and +$0.9bn during last week, respectively.
The following link will be available for 90 days. For more information, please click on the link for the full PDF. If you have any trouble viewing the link, copy and paste the link in a browser.
http://pull.db-gmresearch.com/p/631-B100/50379807/US_ETF_Market_Weekly_Review.pdf
CBOE to Launch S&P 500 Index Range Options
Allows investors to trade S&P 500 index options using a range of strike prices
August 21, 2012--Chicago Board Options Exchange, Incorporated (CBOE) announced today that it will launch trading in a new type of S&P 500(R) Index options contract, known as CBOE S&P 500 Range options (ticker: SRO), beginning on Tuesday, August 28.
CBOE Range options were designed to provide individual investors with a lower-risk, lower-cost way to trade S&P 500 Index options.
SROs pay an exercise settlement amount if the settlement value of the underlying index at expiration selected by the investor falls within a specified "range length." The range length for SROs will be set at 70 S&P 500 Index points.
SRO payouts work as follows: If the S&P 500 Index settlement value falls within the middle 50 points of the 70-point range, the payout for the option will be $1,000. If the S&P 500 Index settlement value falls within the 10 points on either side of the 50-point range, the payout amount will decrease linearly (e.g., positive payout will be between $999 to $1) to zero.
The Broker Wars Take an Unfortunate Turn
August 21, 2012--For nearly three years, investors in exchange-traded funds have found brokerage companies increasingly willing to offer big deals on some highly in-demand products.
Millions of investors now have access to a variety of commission-free ETFs, helping them cut their trading costs dramatically.
Recently, however, the commission-free ETF movement got its first bad news in a long time. With a recent spate of ETF closures, the episode shows how important it is for investors to focus on ETFs that will survive and thrive over the years.
S&P Dow Jones Indices Announces Changes To The S&P/TSX Canadian Indices
A Deletion From The S&P/TSX SmallCap And Global Mining Indices
August 21, 2012--S&P Canadian Index Services will make the following changes in the S&P/TSX Canadian Indices:
The shareholders of Extorre Gold Mines Ltd. (TSX:XG) have accepted the cash and share takeover offer from Yamana Gold Inc. (TSX:YRI).
Extorre Gold shares will be exchanged for $CDN3.50 cash and 0.0467 shares of Yamana. Extorre Gold will be removed from the S&P/TSX SmallCap and Equity SmallCap, the S&P/TSX Global Mining and the S&P/TSX Global Gold Indices effective after the close of Friday, August 24, 2012.
iShares files with the SEC-iShares MSCI ACWI Investable Market Index Fund
August 20, 2012--iShares has filed a post-effective amendment, registration statement with the SEC for the iShares MSCI ACWI Investable Market Index Fund.
view filing
