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Invesco PowerShares Says CEO Bond Steps Aside
November 20, 2009--Bruce Bond is stepping down as chief executive of exchange-traded fund provider Invesco PowerShares Capital Management LLC
Mr. Bond, who founded the Wheaton, Ill., firm in 2003, is passing the role on to Ben Fulton, now the company's executive vice president of global product development. Mr. Bond will continue in the role of chairman.
"He's transitioning to the chairman role, and Ben Fulton will be the managing director of the global ETF business," said a spokeswoman for the firm. She didn't comment on why Mr. Bond is making the move.
The Truth V. The National Journal: You have got to be kidding
November 20, 2009--Today, House Financial Services Committee Communications Director Steve Adamske released the following statement after reading the Nov. 21 National Journal article, “End of the Beginning,” written by John Maggs:
“You have got to be kidding.”
On page 54 of the November 21 edition, reporter John Maggs invents a “question and answer” article that discusses the status of financial regulatory reform. The article has several errors and misrepresentations that have been corrected below:
National Journal: What's going on with financial regulatory reform? I know that Dodd has a new plan and that Frank is expected to move his plan out of committee soon, but I still can't tell what the administration's plan is. Why so many plans? Well, for starters, this re-regulation of finance is huge, so it is natural that everyone would want to drive the train. Primarily, though, the many approaches reflect a strategic decision by the Obama administration. Rather than come out with a fully formed plan and guide the negotiations, the president's advisers decided to let Congress work out the details.
HFSC: This is 100% false. President Obama’s team did indeed produce a plan. They delivered to the House Financial Services Committee and to the Senate Banking Committee a 13 title bill totaling several hundred pages, complete with legislative language, and that language is serving as the base text for our deliberations.
National Journal: But didn't Obama offer a comprehensive bill over the summer? It wasn't a bill; it was called a "blueprint." It was sketchy in its details, and many of its ideas have been changed or abandoned. House and Senate Democratic leaders, for example, now say that regulation by the administration's Consumer Financial Protection Agency should be limited to the largest 10 percent of banks. Other fundamental matters were left unmentioned, such as the way to discourage big banks from taking on too much risk -- how, exactly, to avoid fostering banks that are "too big to fail" and thus take reckless risks because they believe that the government will bail them out. No plan has settled on how to avoid this problem.
HFSC: 100% false again. As discussed above, while President Obama did release a blueprint in early June, he ordered his staff and the Treasury Department to produce a bill. They did. In addition, the National Journal is dead wrong to suggest that we abandoned the administration’s plan. To the contrary, we are implementing the administration’s plans.
CFTC and SEC Issue Joint Orders on Volatility Indexes and Security Futures
November 20, 2009--The Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC) issued two joint orders related to security-based futures contracts that clarify each Commission’s respective jurisdiction and allow additional products to underlie security futures.
The first joint order excludes certain foreign and domestic volatility indexes that are based on broad-based security indexes from the definition of “narrow-based security index.” As a result of the joint order, futures on foreign and domestic volatility indexes that meet the criteria contained in the joint order are treated as “broad-based security indexes” and subject to the exclusive jurisdiction of the CFTC. Options on such volatility indexes are subject to the federal securities laws and the jurisdiction of the SEC. The joint order, contained in SEC Release No. 34-61020, became effective on November 17.
The second joint order allows security futures products to be based on any security that is eligible to underlie an exchange-listed security option, including certain unregistered debt securities. This joint order, which is contained in SEC Release No. 34-61027, became effective on November 19.
BNY Mellon Launches the Composite Depositary Receipts Index
Latest “umbrella index” joins family of nearly 150 DR-only indices with $2 billion in correlated assets
November 19, 2009--BNY Mellon, the global leader in asset
management and securities servicing, has announced the launch of the BNY
Mellon Composite Depositary Receipts IndexSM , a new all-encompassing
measure of the depositary receipts universe.
The BNY Mellon Composite Depositary Receipts Index* comprises all
American depositary receipts (ADRs), New York Shares, and Global
Registered Shares that trade on the New York Stock Exchange (NYSE), NYSE
Amex, NASDAQ and over-the-counter (OTC), as well as global depositary
receipts (GDRs) that trade on the London Stock Exchange (LSE).
The BNY Mellon Composite Depositary Receipts Index is the “umbrella index” for the company’s four existing DR indices:
ADR IndexSM -- tracks all ADRs traded on the NYSE, NYSE Amex and NASDAQ
GDR IndexSM -- tracks all GDRs traded on the LSE
DR IndexSM -- tracks a combination of the ADR Index and GDR Index
Classic ADR IndexSM -- tracks all ADRs traded on the NYSE, NYSE Amex, NASDAQ and OTC
“The creation of the Composite Depositary Receipts Index signifies our commitment to the DR investment community,” said Michael Cole-Fontayn, chief executive officer of BNY Mellon’s Depositary Receipts business. “In keeping with our goals, we are providing DR indices that are 100% investable for both institutional and retail investors, offering recognition to the individual constituents or each foreign company.”
“With nearly $2 billion of assets correlated to the BNY Mellon family of
DR indices, we continue to deliver innovative products to investors
worldwide. There also are now eight exchange-traded funds (ETFs)
benchmarked to BNY Mellon Depositary Receipts Indices,” said Julio Lugo,
global head and vice president of DR Index Solutions at BNY Mellon.
CME Group Inc., the world’s largest and most diverse derivatives marketplace, today announced the launch of trading and clearing services for a new physically delivered Gulf Coast sour crude oil futures contract.
November 20, 2009-- CME Group Inc., the world’s largest and most diverse derivatives marketplace, today announced the launch of trading and clearing services for a new physically delivered Gulf Coast sour crude oil futures contract.
Trading will be available on the CME Globex® electronic trading platform and the New York trading floor. Clearing services will be available through CME ClearPort®, a set of flexible clearing services open to over-the-counter (OTC) market participants to substantially mitigate counterparty risk and provide neutral settlement prices across asset classes. Trading and clearing are scheduled to begin on December 6 for trade date December 7. These contracts will be listed by NYMEX and subject to the rules and regulations of NYMEX and Chicago Mercantile Exchange, Inc.
Paulson plans Gold Hedge Fund
November 19, 2009--John Paulson, the US hedge fund manager who earned billions with savvy bets on the collapse of the US sub-prime mortgage market, is launching a new gold fund, which will include $250 million of his own personal investment.
The fund will focus on gold mining stocks and gold-related investments, according to The Wall Street Journal.
DB Index Research -- Weekly ETF Reports -- US
November 19, 2009--Highlights
ETF Volume
US ETF turnover rose by 3.6% to US$70.4bn in the previous week. Turnover in the S&P 500 SPDR ("Spider") was US$22.5bn. The PowerShares QQQ Nasdaq 100 had turnover of US$4.5bn followed by the iShares Russell 2000 with turnover of US$4.0bn.
There was one new ETF launched in the last week. Van Eck Funds launched 1 new ETF on NYSE Arca.
In the previous week, average daily turnover in the Large Cap, US Sector Leveraged and global regional products was US$29.0bn (2.6%), US$10.6bn (3.2%), US$10.1bn (5.8%) and US$5.4bn (3.2%) respectively.
Among the Emerging country ETFs, iShares MSCI Brazil ETF turnover was US$1,608m followed by iShares FTSE/Xinhua China ETF with turnover of US$974m. In non-US developed market flows, iShares MSCI Japan had turnover of US$240m. In non-domestic regional flows, emerging market turnover was US$4.1bn and developed markets regional flows EAFE had turnover of US$1.1bn.
Assets under Management (AUM)
Total assets under management for equity based ETFs rose by 2.3% in the previous week, AUM were US$584.3bn.
To request a copy of the report click here
Morgan Stanley Exchange-Traded Funds Quarterly Report: Over $730 Billion in 794 ETFs
November 19, 2009--Highlights
Assets under management in US ETF are currently
a record $730 Billion. While much of the asset gain is a result of a recovery in financial markets, ETFs have
attracted net cash inflows exceeding $80 Billion this year and over $250 Billion since the beginning of 2008.
Assets remain highly concentrated with the largest 50 ETFs account for the vast majority of volume and assets. Markets accessible through ETFs include US
and international equities, commodities, and currencies. In addition, fixed income has recently seen the greatest
increase in new offerings.
ETFs provide access to our favorite markets. Morgan Stanley¡¯s global equity strategists are neutral on
the US but are more optimistic about Europe, Japan, Emerging Markets, and Investment Grade Corporate
Bonds. In addition, many of our analysts¡¯ favored industries þu including Agriculture, US Banks, Oil
Equipment and Services þu can be accessed with ETFs.
To request a copy of the report click here
Old Mutual files amended propectus with the SEC
November 19, 2009--Old Mutual has filed an amended prospectus with the SEC for:
GlobalShares FTSE All-World Fund – GSW
GlobalShares FTSE Emerging Markets Fund – GSR
GlobalShares FTSE All-Cap Asia Pacific ex Japan Fund – GSZ
GlobalShares FTSE All-World ex US Fund – GSO
GlobalShares FTSE Developed Countries ex US Fund – GSD
SIFMA Opposes Securities Transaction Tax
November 18, 2009—The Securities Industry and Financial Markets Association (SIFMA) today released a statement from Kenneth E. Bentsen, Jr., executive vice president, public policy and advocacy on a legislative proposal that would impose a tax on securities, futures and derivative transactions.
Imposing a tax on financial transactions is the wrong idea at the wrong time. Such a tax would likely result in a stalling of the stock market, cutting off companies’ ability to raise capital to fund new investments in plants and equipment, and thus create jobs.
“Furthermore, it would directly and detrimentally affect millions of Americans by imposing a tax on their savings such as mutual funds, just as they are seeing their investment assets regain value. Additionally, the exemptions contained in the proposed legislation are completely unworkable.
“At a time when we are in the beginning stages of economic recovery, imposing a tax that would actually constrict economic expansion is bad policy. The better policy direction to ensure any future financial crisis does not result in an economic downturn is establishing a strong systemic risk regulator and clear, unambiguous resolution authority for failing institutions.”
Research Affiliates Awarded Patent for Fundamental Index® Investment Methodology
November 18, 2009 -- Research Affiliates LLC today announced that the United States Patent and Trademark Office has approved the issuance of U.S. Patent No. 7620577 for the company's innovative Research Affiliates Fundamental Index® ("RAFI®") indexing methodology, which selects and weights securities using fundamental metrics of company size rather than by market capitalization.
"We are deeply gratified that the United States Patent and Trademark Office has awarded us this patent," said Robert Arnott, chairman and founder of Research Affiliates. "Our business model differs from most registered investment advisors, in that our core business is developing and licensing new product ideas. So, unlike most asset managers, we have only our ideas to sell; we can protect these ideas as trade secrets or with patents. As we want to encourage wide use of these ideas, we favor the latter.
"Fundamental Index® products have been a tremendous success by every significant measure. Over 20 licensed affiliates use the RAFI® concept to manage products that exceed $25 billion in assets under management, after less than five years from publication of our research. The Fundamental Index® methodology has earned prestigious industry awards, and now Research Affiliates has been granted a patent on its innovative indexing method." Mr. Arnott added, "above all else, we're pleased that the Fundamental Index® approach has produced results, on live assets, that are consistent with our research and have directly benefited investors all over the world."
FTSE RAFI® Index Series
The Fundamental Index® methodology was developed to address the structural return drag created by traditional capitalization-based indexing strategies, which systematically overweight overpriced securities and underweight underpriced securities. According to Research Affiliates' original work on the Fundamental Index® concept, the historical return drag associated with this structural flaw is typically 2% to 4% per annum, globally.
Research Affiliates partnered with FTSE to create the FTSE RAFI® Index Series in 2005. Index constituents are selected and weighted using four fundamental factors, including total cash dividends, free cash flow, total sales and book equity value. Presently, there are well over 100 FTSE RAFI® indexes, covering a broad range of global developed and emerging equity markets.
Mr. Arnott commends the indexing community, but points out an Achilles' Heel in conventional indexes, saying "index funds have served investors well for over 25 years, providing broad stock market exposure at a fraction of the price of actively managed funds. But for all their benefits, capitalization-weighted indexes suffer a structural flaw that leads to overweighting overpriced securities and underweighting underpriced securities. This failing came to a head in the 2000-2002 bear market where a relatively few stocks, notably in the technology sector, led to woeful index fund returns. The Fundamental Index concept cures this deficiency while preserving the many and substantial advantages of index fund investing. Our research shows consistent, significant long-term outperformance of the Fundamental Index ® approach compared to applicable cap-weighted indexes, no matter where the equity market."
Through October 31, 2009, FTSE RAFI® indexes have outperformed their market capitalization-weighted counterparts in 41 of 45 countries, since the launch date of the indexes. The FTSE RAFI® All World 3000 has outpaced the MSCI All Country World Index® by some 4.8% per annum since FTSE first introduced these indexes in November of 2005.
Through October 31, 2009, the FTSI RAFI® 1000 Index, which comprises large cap U.S. equities, outperformed the S&P 500® by 14.39% in 2009, by 1.47% annualized for three years, and by 1.94% annualized since inception of the index. The FTSE RAFI® Developed ex US 1000 Index, which comprises large cap developed foreign market stocks, outperformed the MSCI EAFE Index® by 12.71% for 2009, by 3.48% over three years annualized, and 3.18% since inception. More information on the performance of popular FTSE RAFI® indexes and comparable indexes is available online from Research Affiliates at: http://rallc.com/rafi/performance.htm
NASDAQ OMX Introduces the NASDAQ-100 Leveraged Index
November 18, 2009-The NASDAQ OMX Group, Inc.
(Nasdaq:NDAQ) announced today the introduction of the NASDAQ-100
Leveraged Index(SM) (Nasdaq:NDXL), a new index designed with the
objective of producing two times the daily performance of the
NASDAQ-100 Index(R) with financing costs embedded into the performance
of the index.
"This index will be used as a benchmark by those trying to replicate a
leveraged investment strategy on the widely tracked NASDAQ-100 Index,"
said NASDAQ OMX Executive Vice President John Jacobs. "The Global Index
Group developed this new index as a way to provide investors with
objective ways to measure leveraged returns."
The NASDAQ-100 Leveraged Index is calculated in real-time across the combined exchanges and is disseminated by NASDAQ OMX in U.S. Dollars. The Index commenced calculation today with a value of 1,000.00. To view the values of the NASDAQ-100 Leveraged Index, please go to http://indexes.nasdaqomx.com.
NASDAQ OMX is a global leader in creating and licensing strategy indexes and is home to the most widely watched indexes in the world. As a premier, full-service provider, the NASDAQ OMX Global Index Group is dedicated to designing powerful indexes that are in sync with a continually changing market environment. Utilizing its expanded coverage as a global company, NASDAQ OMX has more than 1,500 diverse equity, commodity and fixed-income indexes in the U.S., Europe, and throughout the world.
NASDAQ OMX's calculation, licensing and marketing support provide the tools to measure and replicate global markets. The NASDAQ OMX Global Index Group's range of services covers the entire business process from index design to calculation and dissemination. For more information about NASDAQ OMX indexes, visit https://indexes.nasdaqomx.com/.
Access to essential historical index data for NASDAQ OMX indexes can be
accessed from a single source, NASDAQ OMX Global Index Watch. For
additional information, please visit
https://indexes.nasdaqomx.com/indexwatch.aspx.
OOK and TXF, state-based funds, ETFs to reduce fees to .20%
November 18, 2009-Geary Advisors, LLC, announced today that they are in the process of reducing the fund
fees for their two state based exchange traded funds OOK and TXF. The advisor has agreed to reduce investment
advisory management fees and to reimburse other expenses to the extent the total annual fund operating expenses,
as a percentage of average daily net assets, exceed .20%. A reduction or reimbursement lowers the expense ratio.
“I believe these funds are excellent way to invest in Oklahoma and Texas companies, many of which are related
to the energy sector.” said Keith Geary, Chairman of Geary Advisors. “We are in the process of lowering the
management fees in pursuit of competitive excellence. We feel we have a great product and want these funds to
be competitive with similar funds”
OOK and TXF are based on the SPADE Index, a modified market capitalization weighted index that seeks to
measure the performance of publicly traded companies who are headquartered in or have significant operations in
Oklahoma and Texas.
At least 10 percent of the OOK and TXF management fees will go to support Aaron’s Bridge, an Oklahoma nonprofit
organization working to establish and provide more treatment options in Oklahoma and Texas for children
with developmental disabilities, including Autism Spectrum Disorder.
For more information about OOK or TXF, visit www.ooketf.com and www.txfetf.com
Supreme Court: When Do Ideas Deserve Patents?
November 18, 2009--It all started in 1997 when a little-known company wanted to patent a method for letting customers of utility companies pay a fixed, predictable sum each month. The patent office rejected their application on the grounds that it was "an abstract idea that simply solves a mathematical problem."
Huge legal expenses and 13 years later, the two men behind the case, Bernard Bilski and Rand Warsaw, had their day in the U.S. Supreme Court on Nov. 9. Most legal experts though, agreed that the duo had no chance of victory. "I don't think anyone other than Bilski thinks that Bilski deserves a patent," says Mark Lemley, a professor of law at Stanford University.
The bench seemed to reflect this view, and several Justices suggested somewhat humorously that if the Bilski argument were to proceed, a number of other ludicrous patents could be issued. Justice Antonin Scalia asked if under Bilski's argument, methods of horse-training could be patented, while the court's newest member, Justice Sonia Sotomayor, asked if a "method of speed-dating" was patentable.
Direxion files prospectus with the SEC
November 18, 2009-Direxion has filed a prospectus with the SEC for
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Direxion Daily Dollar Bull 3X Shares |
Direxion Daily Dollar Bear 3X Shares |
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Direxion Daily Basic Materials Bull 3X Shares |
Direxion Daily Basic Materials Bear 3X Shares |
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Direxion Daily Consumer Discretionary Bull 3X Shares |
Direxion Daily Consumer Discretionary Bear 3X Shares |
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Direxion Daily Consumer Staples Bull 3X Shares |
Direxion Daily Consumer Staples Bear 3X Shares |
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Direxion Daily Healthcare Bull 3X Shares |
Direxion Daily Healthcare Bear 3X Shares |
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Direxion Daily Retail Bull 3X Shares |
Direxion Daily Retail Bear 3X Shares |
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Direxion Daily Utilities Bull 3X Shares |
Direxion Daily Utilities Bear 3X Shares |
