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Investment Perspective -The Trade War End Game
July 12, 2018--President Trump's election platform "Make America Great Again" included protecting jobs and building businesses in the United States. To that end, U.S. Treasury Secretary Steven Mnuchin, Secretary of Commerce Wilbur Ross and the Director of Trade and Industrial Policy Peter Navarro have been working to normalize trade with our global trading partners.
The focus is on normalizing unfair trade practices with China and Germany, but this also includes Canada and Mexico. China exported roughly $525 billion worth of goods to the United States last year and imported only $135 billion. President Trump is seeking to narrow that gap.
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Source: Winthrop Capital Management
U.S. Weekly FundFlows Insight Report: Despite a Market Rally During the Week, Investors Are Net Redeemers of Equity Funds
July 12, 2018--For the first week in five investors were net purchasers of overall fund assets (including those of conventional funds and ETFs), injecting a little less than $23.4 billion for Thomson Reuters Lipper's fund-flows week ended July 11, 2018. However, despite strong economic news reported during the week, fund investors were net redeemers of equity funds (-$1.8 billion), while trade concerns drove investor assets into money market funds (+$21.3 billion), taxable bond funds (+$3.3 billion), and municipal bond funds (+$651 million).
Market Wrap-Up
During the flows week investors were generally optimistic ahead of the beginning of the Q2 2018 earnings reporting season, pushing the U.S. broad-based indices into the plus-column for four of the five trading days, but fund investors remained cautious.
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Source: Thomson Reuters
AdvisorShares Launches Dorsey Wright Micro Cap ETF (DWMC) and Dorsey Wright Short ETF (DWSH)
July 12, 2018--AdvisorShares, a leading sponsor of actively managed exchange-traded funds (ETFs), announced that the AdvisorShares Dorsey Wright Micro Cap ETF (Ticker: DWMC) and the AdvisorShares Dorsey Wright Short ETF (Ticker: DWSH) began trading on July 11, 2018.
DWMC and DWSH are actively managed by Nasdaq Dorsey Wright who are renowned for their core philosophy of relative strength investing, which involves buying securities that have appreciated in price more than the other securities in their investment universe and holding those securities until they exhibit sell signals. Both DWMC and DWSH follow this core philosophy and use technical, systematically-driven approaches that refrain from using fundamental company data and remove any human emotion from the day-to-day decision making. Dorsey Wright also utilizes their proprietary relative strength approach as the portfolio manager for the AdvisorShares Dorsey Wright ADR ETF (Ticker: AADR), which carries a five-star Morningstar rating for its overall risk-adjusted performance and ranks among the top-performing international equity strategies among both mutual funds and ETFs.1
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Source: weny.com
Compliance Issues Related to Best Execution by Investment Advisers
July 11, 2018--I. Introduction
The Office of Compliance Inspections and Examinations ("OCIE") is issuing this risk alert to provide investment advisers ("advisers"), investors and other market participants with information concerning many of the most common deficiencies that the staff has cited in recent examinations of advisers' compliance with their best execution obligations under the Investment Advisers Act of 1940 (the "Advisers Act").1
The Advisers Act establishes a federal fiduciary standard for investment advisers.2 As a fiduciary, when an adviser has the responsibility to select broker-dealers and execute client trades, the adviser has an obligation to seek to obtain "best execution" of client transactions, taking into consideration the circumstances of the particular transaction.
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Source: SEC.gov
CFTC.gov Swaps Report Update
July 11, 2018--CFTC's Weekly Swaps Report has been updated, and is now available.
July 11, 2018--Will Lower Costs for Investors Managing Risk
The U.S. House of Representatives passed H.R. 5749, the Options Markets Stability Act.
The legislation authored by U.S. Rep. Randy Hultgren (IL-14) would facilitate liquidity in options markets by calling on bank regulators to provide targeted capital relief.
"This legislation is aimed at helping Illinois, the birthplace and home of listed options markets. Healthy options markets provide ample opportunity for investors to plan for the future and hedge risk. The market volatility seen in equity markets earlier this year exposed the extent to which existing rules are restricting liquidity when it is needed the most. Unfortunately, market-makers who provide liquidity for listed options are indirectly constrained by bank capital rules from fulfilling their role in maintaining price stability, leading to less liquidity and higher costs for investors who want to hedge risk," said Rep. Hultgren.
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Source: ultgren.house.gov
New Solactive USD China Corporate High Yield Bond Index
July 10, 2018--Solactive is pleased to announce that the Solactive USD China Corporate High Yield Bond Index will be used as an underlying for the latest KraneShares CCBS China Corporate High Yield Bond USD Index ETF (KCCB).
A main driver for this ETF has been the increasing demand of high yield by USD investors. Due to the growing size of bond issuance in China, and the continuous growth opportunities provided by this market, the fund is an interesting vehicle to gain exposure to high yielding assets with a low correlation to US and global markets.
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Source: Solactive AG
FTSE Russell appoints Latin America regional lead to enhance its presence
July 10, 2018--FTSE Russell today announced that Jesus Togno has joined the firm to lead business development and client relationships in Latin America.
Based in the firm's Mexico City office, Togno will focus on managing and growing relationships across the region for FTSE Russell indexes, data, market information and tools.
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Source: FTSE Russell
AdvisorShares Active ETF Market Share Update-Week Ending 7/6/2018
July 9, 2018--Assets in actively managed ETFs added $623 million last week to reach $58.73 billion in total net assets.
iShares led new AUM growth with $133 million followed by JP Morgan, which gained $124 million. There were no funds that launched or closed, maintaining the total of actively managed ETFs currently trading at 232.
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Source: AlphaBaskets
CFTC.gov Commitments of Traders Reports Update
July 9, 2018--The current reports for the week of July 6, 2018 are now available.
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Source: CFTC.gov