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ETF managers beat a path to the patent office
August 10, 2011--The rapid pace of innovation and increasing competitive pressures have a number of exchange traded fund innovators flocking to the patent office for protection.
In the past year, the US Patent and Trademark Office issued 10 patents to five firms for structures, computer systems and technologies for building and trading exchange traded products. That compares to only one such patent issued in 2005.
Invesco Canada Ltd. today introduced the latest addition to its PowerShares® Funds family.
August 9, 2011--PowerShares QQQ Class* gives investors exposure to the U.S.-listed PowerShares QQQ (NASDAQ: QQQ), one of the world's largest and most actively traded ETFs (exchange-traded funds). This ETF provides access to the 100 largest U.S. and international non-financial companies listed on The NASDAQ Stock Market based on market capitalization.
"Through our new Fund, investors can complement and diversify their portfolios with sector exposure that differs from that of the S&P/TSX Composite Index, which is heavily concentrated in the financials, materials and energy sectors," said Michael Cooke, Head of Distribution, PowerShares Canada.
Additional benefits of PowerShares QQQ Class include:
U.S.-dollar hedging that lets investors be confident that their investments won't be affected by changes in the value of the Canadian dollar relative to the U.S. dollar, as the underlying ETF hedges substantially all of its U.S.-dollar exposure**
Greater tax efficiency because the Fund is offered in the corporate structure, allowing for switches between funds in the same corporation on a tax-deferred basis Now featuring 21 funds across a range of sectors and asset classes, PowerShares® Funds are innovative investment solutions that conveniently bring the many benefits of exchange-traded funds to the mutual fund structure, providing all Canadian advisors and their clients with access to PowerShares index-based products.
Federal Open Market Committee Statement
August 9, 2011--Information received since the Federal Open Market Committee met in June indicates that economic growth so far this year has been considerably slower than the Committee had expected. Indicators suggest a deterioration in overall labor market conditions in recent months, and the unemployment rate has moved up. Household spending has flattened out, investment in nonresidential structures is still weak, and the housing sector remains depressed. However, business investment in equipment and software continues to expand. Temporary factors, including the damping effect of higher food and energy prices on consumer purchasing power and spending as well as supply chain disruptions associated with the tragic events in Japan, appear to account for only some of the recent weakness in economic activity.
Inflation picked up earlier in the year, mainly reflecting higher prices for some commodities and imported goods, as well as the supply chain disruptions. More recently, inflation has moderated as prices of energy and some commodities have declined from their earlier peaks. Longer-term inflation expectations have remained stable.
Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. The Committee now expects a somewhat slower pace of recovery over coming quarters than it did at the time of the previous meeting and anticipates that the unemployment rate will decline only gradually toward levels that the Committee judges to be consistent with its dual mandate. Moreover, downside risks to the economic outlook have increased. The Committee also anticipates that inflation will settle, over coming quarters, at levels at or below those consistent with the Committee's dual mandate as the effects of past energy and other commodity price increases dissipate further. However, the Committee will continue to pay close attention to the evolution of inflation and inflation expectations.
XTF Data Now Available on RIMES
August 9, 2011--RIMES Technologies, the award-winning benchmark data service provider, today announced that it has become the first data integrator to offer ETF ratings and analytical data from XTF, the global research and advisory firm dedicated to helping investors harness the power of Exchange Traded Funds.
XTF offers a focused range of technical and fundamental research, financial services and technologies that help investors understand the role ETFs play in enhancing investment returns and managing risks; they developed a quantitative, transparent, rules-based ETF ratings process which is rapidly becoming the industry standard by which all ETFs can be evaluated and compared. XTF offers the most comprehensive and analytical ETF data available today.
The XTF database evaluates the structural integrity and investment metric of every ETF including all costs, liquidity, tracking error, returns and risk. XTF also maintains the complete listing of every US-listed ETF and every component and component weight back to inception for every ETF on a daily basis. The data includes all rebalancing, cash components, excluded assets, and distributions automatically adjusted for on a daily basis, together with the Total Return of the ETF and the Total Return of the corresponding underlying index on a daily basis. ETFs are added and corresponding data made available usually by the first day of trading.
Deutsche Bank's db-X Opens NYSE Arca on August 9
August 9, 2011--Deutsche Bank's db-X Group will ring the opening bell to commence trading on NYSE Arca today. The opening ceremony commemorates the launch of the db-X Exchange Traded Fund (ETF) platform in the United States.
On June 9, 2011, Deutsche Bank launched the db-X US platform with five currency-hedged ETFs designed to provide investors with exposure to international equity markets while at the same time mitigating exposure to fluctuations between the value of the US dollar and selected international currencies. The db-X US platform now consists of the following 10 funds:
db-X MSCI Japan Currency-Hedged Equity Fund (nyse arca:DBJP)
db-X MSCI Brazil Currency-Hedged Equity Fund (nyse arca:DBBR)
db-X MSCI Canada Currency-Hedged Equity Fund (nyse arca:DBCN)
db-X MSCI EAFE Currency-Hedged Equity Fund (nyse arca:DBEF)
db-X MSCI Emerging Markets Currency Hedged Equity Fund (nyse arca:DBEM)
db-X 2010 Target Date Fund (nyse arca:TDD)
db-X 2020 Target Date Fund (nyse arca:TDH)
db-X 2030 Target Date Fund (nyse arca:TDN)
db-X 2040 Target Date Fund (nyse arca:TDV)
db-X In-Target Date Fund (nyse arca:TDX)
"Deutsche Bank has been effectively providing US investors with a variety of innovative exchange traded products across asset classes for over five years," said Martin Kremenstein, Chief Investment Officer of Deutsche Bank's db-X North America business. "With the recent launch of the five currency-hedged ETFs together with the recent rebranding of the five target date ETFs, we are building on the success of our existing ETF platform in the US to offer distinctive solutions to our clients."
Fed holds short-term rates to mid-2013
August 9, 2011--The US Federal Reserve has attempted to tackle a rapidly weakening economy by freezing short-term interest rates for two years and opening the door to more quantitative easing, in a move that sent the dollar and Treasury yields sharply lower.
The rate-setting Federal Open Market Committee said: “The committee currently anticipates that economic conditions – including low rates of resource utilisation and a subdued outlook for inflation over the medium run – are likely to warrant exceptionally low levels for the federal funds rate at least through mid-2013.”
S&P Balks at SEC Proposal to Reveal Rating Errors
August 8, 2011--Standard & Poor's, whose unprecedented downgrade of U.S. debt triggered a worldwide stocks sell-off, is pushing back against a U.S. government proposal that would require credit raters to disclose "significant errors" in how they calculate their ratings.
S&P, which was accused by the Obama administration of making an error in its calculations leading to Friday's downgrade, raised concern about the proposed new corrections policy and other issues in an 84-page letter to the Securities and Exchange Commission, dated August 8.
Investors Using ETPs more for Risk Management
August 8, 2011--Stomach-turning global volatility has bolstered demand for certain alternative exchange-traded products used by institutions to quickly hedge their portfolios or make directional bets to profit from market instability.
“We've seen pretty significant year-to-date increases on inverse” exchange-traded products, said Russ Koesterich, managing director and global chief investment strategist in San Francisco for BlackRock Inc.'s iShares business. “In general, investors are using these products to position against what they think might be a dour movement of assets and they want to hedge part of that exposure.”
Mexico: Selected Issues
August 8, 2011--I. POTENTIAL GROWTH AND THE OUTPUT GAP IN MEXICO
1
Decomposing the growth process in trend and cyclical factors represents an important
challenge, with implications for policy decisions. This paper applies several methodologies to the case of Mexico and tries to assess to what extent these methodologies adequately capture cyclical changes.
The results suggest that care is needed when using these indicators
in real time to assess the stage of the cycle, particularly in the presence of large shocks, and that a variety of macroeconomic indicators are needed to evaluate and validate the results.
A. The Output Gap
1. Estimates of the output gap are important for the conduction of macroeconomic
policies. The central bank‘s inflation targeting framework entails assessing if the projected output implied by the monetary policy stance is consistent with the inflation target.
view IMF paper-Mexico: Selected Issues
FlexShares files with the SEC
August 8, 2011--FlexShares has filed a pre-effective amendment no. 1, registration statement with the SEC for the
FlexSharesSM Morningstar US Market Factor Tilt Index Fund
FlexSharesSM Morningstar Global Upstream Natural Resources Index Fund
FlexSharesSM iBoxx 3-Year Target Duration TIPS Index Fund
FlexSharesSM iBoxx 5-Year Target Duration TIPS Index Fund
FlexSharesSM iBoxx 7-Year Target Duration TIPS Index Fund
FlexShares files with the SEC
August 8, 2011--FlexShares has filed an amended and restated application for exemptive relief with the SEC for actively-managed ETFs.
view filing
CME Clearing is Not Planning to Adjust Haircuts Following S&P Rating Change to U.S.
August 8, 2011--CME Clearing President Kim Taylor made the following statement regarding the recent S&P change to the U.S.'s AAA credit rating:
"CME Clearing has evaluated the market situation surrounding the U.S. downgrade and has determined that there is no current need for changes to our collateral haircuts or policies for accepting U.S. Treasuries as margin collateral.
We will continue to monitor the liquidity environment and advise market participants if the environment changes."
CME Group has been helping customers manage their risk through a variety of market conditions for over 150 years. We are proud of our strong track record and are confident that our risk methodologies will protect the markets and market users we serve.
Dow Jones Indexes, UBS Investment Bank Launch Dow Jones-UBS Roll Select Commodity Index
New Index Designed to Mitigate Effects of Contango on Index Performance
August 8, 2011-- Dow Jones Indexes, a leading global index provider, and UBS Investment Bank today announced the launch of the Dow Jones-UBS Roll Select Commodity Index, a gauge that aims to mitigate the negative effects of contango on index returns.
For each commodity, the new index -- a version of the Dow Jones-UBS Commodity Index series -- rolls from the expiring futures contract into the contract showing the least contango (or greatest backwardation), selecting from those specified contracts with nine months or fewer until expiration. By contrast, the Dow Jones-UBS Commodity Index rolls on a predetermined schedule into specified futures contracts, typically the ones with "nearby" expirations.
When the prices for exchange-traded futures contracts are higher in the distant delivery months than in the nearer delivery months, the market is said to be in "contango". For example, the sale of a January contract would take place at a price that is lower than the purchase price of a March contract. Holding other factors constant, contango generally has a negative impact on index returns, as the higher longer-term future prices move lower over time to the shorter-term prices. This potential convergence over time is often referred to as a negative "roll yield".
S&P, TMX Group Launch S&P/TSX Venture Select Index for the Canadian Market
S&P Licenses Blackrock to List ETF Based Upon the Index
August 8, 2011--Providing Canadian investors with a new and innovative approach to tracking the performance of smaller-cap Canadian Stocks trading on TSX Venture Exchange, S&P Indices and TMX Group Inc., owner of Toronto Stock Exchange and TSX Venture Exchange, launched today the S&P/TSX Venture Select Index.
The S&P/TSX Venture Select Index measures the performance of constituents in the S&P/TSX Venture Composite Index that meet specific market capitalization and liquidity criteria.
The S&P/TSX Venture Composite is a broad market indicator of Canadian micro-cap securities.
S&P Indices also announced today that it has licensed Blackrock, Inc., one of the world's largest providers of exchange traded funds (ETF) to launch an ETF based upon the S&P/TSX Venture Select Index.
"With the launch of this Index, investors will have the opportunity to track the performance of the growth in Canadian micro-cap securities," says Abigail Etches, Director at S&P Indices.
For more information about the S&P/TSX Venture Select Index, please visit: www.standardandpoors.com/indices.
Morgan Stanley -ETF Weekly Update
August 8, 2011--Weekly Flows: $5.6 Billion Net Outflows
ETF Assets at $1.0 Trillion, Up 2% YTD
Launches: 3 New ETFs
iShares Changes Expense Ratios on 11 ETFs
US-Listed ETFs: Estimated Flows by Market Segment
Amid a broad sell-off in global equities, ETFs posted net outflows of $5.6 bln last week
aggregate net outflows of $8.2 billion)
Conversely, commodity ETFs, particularly those holding gold and silver, generated net inflows last week
ETF assets fell by 7% last week, primarily related to market declines, and stand at $1.0 trillion, up 2% YTD
13-week flows remain mostly positive among asset classes; combined $19.3 bln net inflows
Fixed Income & Commodity ETFs up $8.8 and $4.1 bln, respectively; US Large-Cap ETFs down $2.0 bln
We estimate ETFs have generated net inflows 18 out of 31 weeks YTD; YTD net inflows of $63.4 bln
US-Listed ETFs: Estimated Largest Flows by Individual ETF
Despite a 10% market price decline last week, the iShares Russell 2000 Index Fund (IWM) generated net inflows of $1.6 bln last week, the most of any ETF
Renewed fears related to slowing global growth, European debt concerns and the specter of a US credit rating
downgrade extended GLDs streak of net new money to four weeks (aggregate net inflows of $4.2 bln)
SPDR S&P 500 ETF (SPY) exhibited the largest net outflows of any ETF over the past 1- and 4-week periods
