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Morgan Stanley-Preliminary 3Q2012 ETF Net Cash Flows Estimates
October 3, 2012--We estimate that net cash inflows into US-listed ETFs were
$58.3 billion during the third quarter of 2012. This report
contains our estimates and analysis of 3Q 2012 ETF flows for the US
market. Once official data are released, we will publish our more
comprehensive flow analysis.
The $58.3 billion during 3Q 2012 is above the $34.0 billion
average quarterly net cash inflows over the past three years.
Year to date, we estimate ETF net inflows at $135.9 billion, which is
already more than the total net cash inflows in each of the full years
from 2009-2011. US-listed ETF assets are now almost $1.3 trillion,
which is up 23% year to date.
The largest net cash inflows went into ETFs tracking US Large-Cap and Fixed Income indices. These segments had net cash inflows of $13.0 billion and $8.1 billion in 3Q 2012, bringing their total inflows for the first three quarters of the year to $25.3 billion and $41.2 billion, respectively. US Sector & Industry ETFs also had a strong quarter with net inflows of $7.7 billion. Currency ETFs were the only segment to post net outflows (only $76 million) in 3Q 2012.
BlackRock’s net cash inflows of $18.3 billion in 3Q 2012 were the
largest of any provider. State Street had the next highest net cash
inflows at $15.1 billion.
As of 9/28/12, BlackRock, State Street and
Vanguard accounted for almost 79% of ETF assets.
There were 30 ETFs launched and 27 liquidated in the US during 3Q 2012. There have been 130 ETFs issued and 44 closures this year (additional 29 liquidations announced).
As of 9/28/12, there were 36 issuers with 1,252 ETFs.
Roughly $9 billion in total ETF market cap is from ETFs issued over the past year. The most successful recent launches (by total assets) focus on fixed income and on low volatility equity indices.
request report
Source: Morgan Stanley
CFE Temporarily Postpones Launch Date For S&P 500 Variance Futures
October 3, 2012--CBOE Futures Exchange, LLC (CFE) today announced that it has temporarily postponed the launch of S&P 500 Variance futures, originally scheduled to begin on Thursday, October 4.
The additional time will allow market participants to further prepare for the trading and clearing of S&P 500 Variance futures.
CFE plans to launch S&P 500 Variance futures later this quarter and will announce the new launch date when it has been determined.
For more information on S&P 500 Variance futures: www.cfe.cboe.com/Products/Products_VA.aspx.
Source: CBOE
ISE Introduces Risk Management Feature in Kill Switch
October 3, 2012--The International Securities Exchange (ISE) today announced the implementation of its electronic "Kill Switch" functionality in PrecISE Trade(R), ISE's innovative, front-end execution system.
The Kill Switch has already been available for exchange members that are connected to ISE via a Direct Trading Interface (DTI) or FIX connection. By extending this functionality to PrecISE, this segment of ISE’s membership community now has the ability to utilize the Kill Switch to cancel all open orders and prevent new order submissions for more comprehensive risk management. In addition, if a DTI or FIX user is unable to access their system during a session, PrecISE serves as an alternative means of enabling the Kill Switch.
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Source: International Securities (ISE)
Brown Brothers Harriman, Hilliard Lyons, Legg Mason, Edward Jones, and JPMorgan Chase Recognized with SIFMA Diversity Leadership Awards
October 3, 2012--SIFMA today awarded Brown Brothers Harriman, Hilliard Lyons, Legg Mason, Edward Jones, and JPMorgan Chase with its annual Diversity Leadership Awards.
Emerging Diversity Leadership: Brown Brothers Harriman - Possibility Thinking and Hilliard Lyons - Women’s Financial Consultant Roundtable.
Innovative Diversity Leadership: Legg Mason - Diversity & Inclusion Leadership Council Board Leadership Program.
Sustained Diversity Leadership: Edward Jones - Cross-Cultural Development Program.
Team Diversity Leadership: JPMorgan Chase - Black Organization for Leadership Development.
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Source: SIFMA
Introductory Remarks At SEC's Market Technology Roundtable By SEC Chairman Mary L. Schapiro
October 2, 2012--Good morning. Thank you to all of the panelists for taking time to share your thoughts with us on market technology. And thank you to those who have already written in with your comments. You have given us a number of very thoughtful recommendations.
To an extraordinary extent, the stability of our securities markets is tied to the technological infrastructure of those markets.
As with virtually every industry, technology brings many benefits. And our markets are no different. Thanks to technology, our securities markets are more efficient and accessible than ever before.
But we also know that technology has pitfalls. And when it doesn’t work quite right, the consequences can be severe.
Just imagine what can happen:
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Source: SEC.gov
S&P Dow Jones Indices announces changes to the S&P/TSX Canadian Indices
A Deletion from the S&P/TSX Income Trust Index October 2, 2012--S&P Canadian Index Services will make the following changes in the S&P/TSX Canadian Indices:
The stapled unitholders of Labrador Iron Ore Royalty Corporation (LIF-UN.TO) have approved the restructuring of the company to a corporate structure.
The name of the company is not changing and the new ticker symbol will be "LIF". Following this restructuring, the company will be removed from the S&P/TSX Income Trust Index and added to the S&P/TSX Equity, Capped Equity and Equity Completion indices. The company will remain a constituent of the S&P/TSX Composite, Capped Composite and Composite Equal Weight, the S&P/TSX Completion, the S&P/TSX Capped Materials and the S&P/TSX Composite Dividend Indices. All these changes will be effective after the close of trading on Thursday, October 4, 2012 .
Source: S&P Dow Jones Indices
DB-Global Equity Index and ETF Research-North America-US ETF Investment Ideas-Implementing the House View with ETFs
October 2, 2012-While the central bank actions have encouraged flows into risk assets, the overwhelming policy response highlights just how fragile the outlook remains. Our base case is that growth will bottom out in Q3/Q4 and accelerate in 2013. Downside risks remain, however, which could have knock-on effects in other regions, risking a negative growth and asset price spiral.
Asset Class Views: Fed and ECB easing to provide ‘safety net’ to risky assets
The cross asset class views from DB strategists are moderately bullish on US equities, long gold, bullish on the EUR/USD, bearish on Core rates, and moderately bullish on Credit.
ETF Implementation: Moderate risk-on positioning
We present a number of ETF portfolios which seek to capture the upside of the risk-on trade, while at the same time protect against sudden drops by selecting less correlated asset classes.
Given the current outlook and market conditions which present a more favorable tilt towards risky assets we focus on exploring long positions in US equity, and HY and EM credit. Furthermore, given the USD weakness and relative strength of the EUR and gold we explore long positions on the EUR and gold, and short positions on the USD. At the same time, we also examine short positions on core rates given a possible rise in yields over the next 3-6 months.
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/577-6A22/34339792/US_ETF_Investment_Ideas.pdf
Source: Deutsche Bank - Global Equity Index and ETF Research
U.S. market players urge caution on designing "kill switches"
October 2, 2012--Brokerage and exchange technology gurus generally endorsed the concept of deploying "kill switches" to stop computer errors before they can unleash havoc on the market, but they warned regulators on Tuesday to ensure they are not set off too easily.
Speaking at a roundtable hosted by the U.S. Securities and Exchange Commission, experts said they recognized the need for more safeguards after a series of scary software glitches.
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Source: Reuters
Vanguard Selects FTSE as Index Benchmark Provider for Six International Stock Index Funds
October 2, 2012--FTSE Group ("FTSE") has been selected by Vanguard, one of the top three US asset management firms, as the index benchmark provider for six international equity index funds with aggregate assets of $170 billion as of August 31.
These funds will transition to benchmarks in the FTSE Global Equity Index Series, replacing MSCI. This transaction represents the largest international index provider benchmark switch ever and includes the world’s largest emerging markets fund, the $67bn Vanguard Emerging Markets Stock Index Fund and its exchange-traded fund (Ticker: VWO). These funds will move to the FTSE Emerging Index.
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Source: FTSE
MSCI Falls Most on Record as Vanguard Dumps Its Indexes
October 2, 2012--MSCI Inc. (MSCI) fell the most on record after being dropped as benchmark provider for 22 index funds by Vanguard Group Inc., the largest U.S. mutual-fund company.
MSCI declined 27 percent to close at $26.21 in New York, the most since it went public in November of 2007, after Vanguard said funds with about $537 billion in assets will replace New York-based MSCI to cut costs for fund shareholders.
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Source: Bloomberg
