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CFTC and SEC Chairmen Issue Update on Harmonization Report
September 30, 2009--The Chairmen of the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC) announced today that they anticipate, in two weeks, the two agencies will issue a report that will address key areas in which their regulatory schemes are different. The Chairmen also expect the report will recommend legislative and regulatory actions to address those differences where appropriate.
On June 17, 2009, the White House released a White Paper on Financial Regulatory Reform calling on the CFTC and SEC to “make recommendations to Congress for changes to statutes and regulations that would harmonize regulation of futures and securities.”
Subject to consideration of the Commissions, a report is expected to be issued on October 15 to address harmonization of futures and securities regulation. It is anticipated that the report will include discussion of the following issues:
• Product listing and approval;
• Exchange/clearinghouse rule approval under rules- versus principles-based approaches;
• Risk-based portfolio margining and bankruptcy/insolvency regimes;
• Linked national market and common clearing versus separate markets and exchange-directed clearing;
• Market manipulation and insider trading rules;
• Customer protection standards applicable to broker-dealers, investment advisors and commodity trading advisors; and
• Cross-border regulatory matters.
In addition, the Chairmen expect that the report will contain recommendations to Congress and the President designed to (1) strengthen their respective enforcement powers;
(2) enhance and harmonize customer protection standards; and
(3) establish an ongoing coordination and advisory process.
“The CFTC and the SEC have been working very closely to tailor our regulations in the best interest of the American public,” CFTC Chairman Gary Gensler said. “I look forward to reporting to Congress and the President on identifying substantive changes that both agencies can make to close regulatory gaps, address inconsistencies and ensure that any overlap best serves the public.”
“We must continue to build upon the progress we are making to reduce regulatory arbitrage, avoid unnecessary duplication and close regulatory gaps,” said SEC Chairman Mary Schapiro. “We are fully committed to continuing on the path toward reform.”
In addition to extensive discussions between the agencies, the two regulatory bodies held their first ever joint public meetings earlier this month. The meetings sought to solicit views from industry participants, experts, and the public on the current regulatory scheme, harmonization of the agencies’ rules and recommendations for changes to statutes and regulations. The agencies also solicited written comments to further assist their deliberations.
Source: CFTC.gov
CFTC Seeks Public Comment on Request From New York Mercantile Exchange Involving Contracts Traded on the Dubai Mercantile Exchange
September 30, 2009--The Commodity Futures Trading Commission (Commission) is requesting public comment on a petition submitted by the New York Mercantile Exchange to amend an existing order in connection with contracts traded on the Dubai Mercantile Exchange (DME).
In May 2007, the Commission issued an order under Section 4d of the Commodity Exchange Act permitting DME and clearing member futures commission merchants to hold customer positions and associated funds held in connection with NYMEX’s clearing of specific futures contracts traded on or subject to the rules of the DME with other funds held in the segregated account. The order currently requires the margin calculation to cover two days instead of the typical one day. NYMEX now requests that the Commission amend the order to reduce the coverage to one day.
Comments regarding the request should be submitted within 30 days from date of posting.
Comments may be submitted via email to secretary@cftc.gov. All comments received will be posted on the Commission’s website.
Source: CFTC.gov
Insights from Dow Jones Indexes-September 2009
September 30, 2009--Featured in this months issue:
Featured Index Family: Introducing Dow Jones LATixx IndexesSM
Customer Focus:
Brendan Bradley, Global Head of Product Strategy, Eurex
Industry Perspective:
Nicholas Brooks, Head of Research and Investment Strategy, ETF Securities
Employee Profile:
Setting His Own Path: Welcome Tariq Al-Rifai
In Development:
Dow Jones Global IndexesSM: Adding New Countries to the Mix
Market Commentary:
Dow Jones U.S. Economic Stimulus IndexSM
Excerpt from the Note from the Editor-John A. Prestbo Editor and Executive Director Dow Jones Indexes
U.S. President Warren G. Harding won election (and coined a new term) in 1920 with a promise of a “return to normalcy.” American voters, tired of war and disillusioned with the outside world, lapped it up. I will not go so far as to say that the markets have returned to “normalcy” so soon after 2008’s meltdown (if you can even call 2001-2008 “normal”). But players from money managers and individual investors to industry executives and government regulators the world over seem to be back at the table, hoping that maybe—just maybe—the worst is behind us.
read the Insights from Dow Jones Indexes issue
Source: Dow Jones Indexes
International Securities Exchange Announces That Its Portfolio Of First Trust Advisors ETFs Now Exceeds $500 Million In Aggregate Assets Under Management
September 29, 2009--The International Securities Exchange (ISE) today announced that the First Trust Advisors portfolio of exchange traded funds (ETFs) based on ISE's proprietary indexes has reached over $500 million in aggregate assets under management. ISE's "pure play" indexes serve as benchmarks for the ETFs that target high growth sectors including natural gas, global wind energy, the emerging markets of China and India, global engineering and construction services and the water industry.
"We are very excited that these ETFs, which we developed in close partnership with First Trust Advisors, are continuing to gain traction as effective investment vehicles in the marketplace," said Kris Monaco, Director of New Product Development at ISE. "We remain committed to developing a broad range of innovative investment products that allow customers to trade their views on specialized segments of the market."
"First Trust is pleased that the suite of ISE index-based ETFs has reached this important milestone," said Robert F. Carey, CFA and Chief Investment Officer at First Trust. "These products allow us to meet the growing demand for investment vehicles that allow our customers to gain exposure to a broad range of specialty sectors."
First Trust Advisors offers five ETFs based on ISE's proprietary indexes: the First Trust ISE-Revere Natural Gas Index Fund (FCG), the First Trust ISE Global Wind Energy Index Fund (FAN), the First Trust ISE Chindia Index Fund (FNI), the First Trust ISE Water Index Fund (FIW) and the First Trust ISE Global Engineering and Construction Index Fund (FLM). ISE offers options on the First Trust ISE-Revere Natural Gas Index Fund, the First Trust ISE Chindia Index Fund and the First Trust ISE Water Index Fund, as well as on the ISE-Revere Natural Gas Index (FUM) and the ISE Water Index (HHO).
For more information about First Trust Advisors' ETFs, please visit www.ftportfolios.com. For information about ISE's proprietary index portfolio, please visit www.ise.com/index.
Source: International Securities Exchange (ISE)
TRACE Bond Reporting to Now Cover Government Agency Debt-SEC Approval of FINRA Rule Also Expands TRACE to Primary Bond Market
September 29, 2009--The Financial Industry Regulatory Authority announced today that the Securities and Exchange Commission approved a major expansion of FINRA's Trade Reporting and Compliance Engine (TRACE) to include debt issued by federal government agencies, government corporations and government sponsored enterprises (GSEs), as well as primary market transactions in new issues.
Currently, TRACE reports real time pricing and trade volume information only on corporate bonds trading in the secondary market.
Details about the expansion and its implementation are available in FINRA Regulatory Notice 09-57.
"Transparency is a crucial ingredient for investor participation in a market," said FINRA Chairman and Chief Executive Officer Richard G. Ketchum. "Based on our experience with corporate bonds, this expansion should help all investors, and especially retail investors, to better monitor their executions by putting immediate and accurate sales and pricing information in their hands.
"For regulators, there is a demonstrated need for increased bond market information, particularly as we move forward from financial crisis," Ketchum said. "Enhanced disclosure in these markets will allow proactive oversight and a deeper understanding of market dynamics."
Specific market information that is reported through TRACE includes: prices, trade size, the overall size of markets and market participants. Collecting agency and primary market transaction data will enhance FINRA's ability to better detect fraud, manipulation, unfair pricing and other misconduct that violates the federal securities laws and FINRA rules.
TRACE was established in July 2002 to bring transparency to the corporate bond market. It was fully phased in by February 2005, offering real-time, public dissemination of transaction and price data for all corporate bond trades — including intra-day transaction data and aggregate end-of-day statistics (most active bonds, total volume, advances and declines and new highs and lows).
Retail investors have free access to this data at www.finra.org/marketdata. As part of its effort to demystify the corporate bond market and make it truly accessible to retail investors, FINRA has developed a comprehensive online learning center where retail investors can become familiar with the full range of bond types and bond markets. Smart Bond Investing is available at www.finra.org/smartbonds.
Source: FINRA
Dimon shakes up JPMorgan top team
September 29, 2009--Jamie Dimon, chief executive of JPMorgan Chase, on Tuesday carried out a surprise shake-up of its top management team, ousting Bill Winters, co-head of investment banking, and anointing Jes Staley, a veteran banker, as likely heir for the top job.
Under the reshuffle, Mr Staley, who has been at JPMorgan since 1979, will take over the investment bank while Steve Black, the other co-head, becomes executive chairman of the unit for the next 18 months.
read full story
Source: FT.com
Banks Tapped to Bolster FDIC Resources
September 29, 2009--The Board of Directors of the Federal Deposit Insurance Corporation today adopted a Notice of Proposed Rulemaking (NPR) that would require insured institutions to prepay their estimated quarterly risk-based assessments for the fourth quarter of 2009 and for all of 2010, 2011 and 2012.
The FDIC estimates that the total prepaid assessments collected would be approximately $45 billion. The FDIC Board also voted to adopt a uniform three-basis point increase in assessment rates effective on January 1, 2011, and extend the restoration period from seven to eight years.
FDIC Chairman Sheila C. Bair said, "First and foremost, bank customers should know that their insured deposits have and always will be 100 percent safe, no matter what. This commitment to depositors is absolute. The decision today is really about how and when the industry fulfills its obligation to the insurance fund. It's clear that the American people would prefer to see an end to policies that look to the federal balance sheet as a remedy for every problem. In choosing this path, it should be clear to the public that the industry will not simply tap the shoulder of the increasingly weary taxpayer. This proposal is a vote of confidence for the banking industry's resilience, and it will continue to recover its strength as we work through the significant challenges ahead."
Prepayment of assessments will allow the industry to strengthen the cash position of the Deposit Insurance Fund (DIF) immediately, while allowing the capital impact of deposit insurance assessments to be felt gradually over time as the industry improves its own financial position. The banking industry has substantial liquidity to prepay assessments. As of June 30, FDIC-insured institutions held more than $1.3 trillion in liquid balances, or 22 percent more than they did a year ago. Prepaying assessments will put the industry's liquid balances to good use in conserving capital and helping to maintain the capacity of banks to lend while they rebuild the DIF. FDIC analysis indicates that this arrangement is much less likely to impair bank lending than a one-time special assessment.
Public comments are due 30 days after publication in the Federal Register.
View the Deposit Insurance Fund Restoration Plan
View the Notice of Proposed Rulemaking (Draft)
Source: Federal Deposit Insurance Corporation
Broad Improvement in Home Price According to the S&P/Case-Shiller Home Price Indices
September 29, 2009-Data through July 2009, released today by Standard & Poor’s for its
S&P/Case-Shiller1 Home Price Indices, the leading measure of U.S. home prices, show that, although
still negative, the annual rate of decline of the 10-City and 20-City Composites improved compared to
last month’s reading. This marks approximately six months of improved readings in these statistics,
beginning in early 2009.
“The rate of annual decline in home price values continues to decelerate and we now seem to be
witnessing some sustained monthly increases across many of the markets” says David M. Blitzer,
Chairman of the Index Committee at Standard & Poor’s. “The two composites and all metro areas are
showing an improvement in the annual rates of return, as seen through a moderation in their annual declines.
read more
Source: Standard & Poors
NASDAQ OMX Announces August 2009 Market Performance Statistics
September 29, 2009--Thhe NASDAQ OMX Group, Inc.
(Nasdaq:NDAQ) today announced consolidated market performance
statistics for its U.S. exchanges for the month of August 2009.
* The NASDAQ OMX Group, Inc. matched share of total U.S. equity
volume in August 2009 was 21.2%.
-- The NASDAQ Stock Market's (NASDAQ(R)) matched share of U.S.
equity volume was 18.6%, more than any other U.S. exchange.
-- NASDAQ OMX BX matched share of U.S. volume was 2.6%.
The NASDAQ Stock Market:
* The average daily matched volume in all U.S. securities last month
was 1.8 billion shares..
-- The average daily matched trade count in U.S. equities was 7.2
million..
* Matched market share in NYSE-listed securities during August 2009
was 13.5%..
-- The average daily matched volume in NYSE-listed stocks was 789
million shares, a 4.1% increase from last month.
* Matched market share in NASDAQ-listed securities during August 2009 was 30%. -- NASDAQ's average daily matched share volume in NASDAQ-listed securities during August was 644 million shares.
NASDAQ OMX BX:
* NASDAQ OMX BX (BX) has experienced unprecedented growth in the
first seven months of operation. BX matched share of U.S. equity
volume in August was 2.6%. In July, matched share on BX was 2.1%.
-- BX's average daily matched volume in U.S. equities in August
was 250 million shares, an increase of 36.8% over the previous
month.
U.S. ETFs:
* Matched market share in U.S. ETFs during August 2009 was 24.5%,.
more than any other U.S. exchange.
-- Average daily matched share volume of U.S. ETFs in August was
350 million shares.
.
U.S. Equity Options:
* NASDAQ OMX exchanges' matched market share of U.S. equity options
was 20% last month, a 5.8% increase over last year..
-- The average daily matched volume of NASDAQ OMX exchanges in
U.S. equity options totaled 2.5 million contracts in August
2009, a 43.5% increase over last year..
-- In August, matched share on The NASDAQ Options Market (NOM) was
3.5%..
-- NASDAQ OMX PHLX (PHLX) matched share was 16.6%.
The NASDAQ OMX Group, Inc. Monthly Volume and Market Share Report is available at http://media.globenewswire.com/cache/6948/file/7388.pdf
To download more detailed information on NASDAQ OMX and overall U.S. market activity, including FINRA/NASDAQ TRF, NASDAQ Reported, NASDAQ Routed, NASDAQ Handled and Consolidated figures, visit http://www.nasdaqtrader.com/content/marketstatistics/marketshare/useq.x ls.
For information about these and other NASDAQ performance statistics,
visit BATS Exchange Unveils BATS 1000 Index - New Index From Third-Largest Us Equities Exchange read more Fee Rate Advisory #2 for Fiscal Year 2010
In addition, five days after the date of enactment of the Commission’s regular appropriation, the Section 6(b) fee rate applicable to the registration of securities, the Section 13(e) fee rate applicable to the repurchase of securities, and the Section 14(g) fee rate applicable to proxy solicitations and statements in corporate control transactions will be set at $71.30 per million dollars.
The Division of Trading and Markets Office of Interpretation and Guidance is available for questions relating to Section 31, at (202) 551-5777 or at tradingandmarkets@sec.gov. A copy of the Commission’s April 30, 2009, order regarding fee rates for fiscal year 2010 is available at http://www.sec.gov/rules/other/2009/33-9030.pdf.
The Commission will issue further notices as appropriate to keep the public informed of developments relating to enactment of the Commission’s regular appropriation and the effective dates for the above fee rate changes. These notices will be posted at the SEC’s Web site at http://www.sec.gov. U.S. One Trust files with the SEC Advisors Asset Management Introduces the NASDAQ Q-50 Index Portfolio September 28, 2009--Advisors Asset Management,
Inc. and The NASDAQ OMX Group, Inc. (Nasdaq:NDAQ) announced today the
introduction of the NASDAQ Q-50 Index(SM) Portfolio, a unit investment
trust (UIT) that seeks to provide above average total return by
investing in stocks included in the NASDAQ Q-50 Index(SM)
(Nasdaq:NXTQ). The NASDAQ Q-50 Index Portfolio will be available
through licensed financial professionals.
"We are pleased to partner with Advisors Asset Management on the
introduction of the NASDAQ Q-50 Index Portfolio," said NASDAQ OMX
Executive Vice President John Jacobs. "As a result of our
collaboration, investors have a new opportunity to further diversify
their portfolios by investing in some of the world's most innovative
mid-cap growth companies."
The NASDAQ Q-50 Index is a market-capitalization weighted index
designed to track the performance of securities that are next-eligible
for inclusion in the world-renowned NASDAQ-100 Index(R), a globally
recognized benchmark that is the basis of more than 1,200 investment
products in 35 countries. The NASDAQ Q-50 Index is comprised of 50
non-financial securities ranked by market capitalization. They reflect
companies across major industry groups including computer hardware and
software, telecommunications, retail/wholesale trade, and
biotechnology. For more information about the NASDAQ Q-50 Index, visit
https://indexes.nasdaqomx.com/data.aspx?IndexSymbol=NXTQ&menuIndex=0. Big investors press private equity firms read full story State Street launches VRDO Municipal Bond ETF
Specifically, it seeks to track the price and yield performance of the S&P National AMT-Free Municipal VRDO Index. As of 21 September 2009, the index, which includes VRDOs issued by US states, local governments, or agencies, provides exposure to more than 377 issues. read moreread full story
www.nasdaqtrader.com/marketshare.
Source: NASDAQ OMX
September 28, 2009-BATS Exchange, an innovative and technology leading US
securities exchange, today announced the launch of the BATS 1000SM Index, a US-listed securities
benchmark based on the performance of a total of 1000 US-listed securities in 10 defined sectors.
The BATS 1000 Index offers a rare, broad snapshot of the US equities marketplace by tracking the
performance of large-cap, mid-cap and small-cap securities that, unlike other indices, are classified in 10
equally-weighted sectors. The top 100 securities in each sector are ranked by market capitalization and
form the BATS 1000 Index.
Source: BATS Exchange
September 28, 2009-When fiscal year 2010 starts on Oct. 1, 2009, the Securities and Exchange Commission expects to be operating under a continuing resolution that will extend through Oct. 31, 2009. During this period, fees paid under Section 6(b) of the Securities Act of 1933 and Sections 13(e), 14(g) and 31 of the Securities Exchange Act of 1934 will remain at their current rates.
As previously announced, 30 days after the date of enactment of the Commission’s regular fiscal year 2010 appropriation, the Section 31 fee rate applicable to securities transactions on the exchanges and in the over-the-counter markets will be set at $12.70 per million dollars. The assessment on security futures transactions under Section 31(d) will remain unchanged at $0.0042 for each round turn transaction.
Source: SEC.gov
September 28, 2009--U.S. One Trust
has filed an application for exemptive relief with the SEC.
view filing
Source: SEC.gov
Unit Investment Trust Seeks Above Average Total Return
"The NASDAQ Q-50 Index Portfolio is a convenient and cost effective way
to invest in some of the world's fastest growing mid-cap companies in a
diverse range of industries," said Richard A. Stewart, CFA, Senior Vice
President of Advisors Asset Management. "We are pleased to add the
NASDAQ Q-50 Index Portfolio to our broad array of solutions that are
designed to meet a wide range of investment objectives."
Source: NASDAQ OMX
September 28, 2009--There is an irony in the brewing tension between investors and private equity firms, says Leon Shahinian, manager of private equity investments at the California Public Employees Retirement Scheme (Calpers).
The private equity model is based on “great transparency and governance and a strong alignment of interests between company executives and their private equity investors”, he says. Managers invest heavily in their own funds, take board seats in companies they back and keep a close eye on the performance of their investments.
Source: FT.com
September 27, 2009--State Street Global Advisors, the investment management arm of State Street Corporation, has launched the SPDR S&P VRDO Municipal Bond ETF on the NYSE Arca.
The ETF is designed to provide investors with access to municipal variable rate demand obligations (VRDOs), an asset class offering attractive yields and stable income that is exempt from federal taxes and often state and local income taxes as well.
Source: ETF Express