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Gold ETFs mushroom in India
August 18, 2011--Gold exchange-traded funds (ETFs) may be new for India, but are gaining in popularity as investors become aware of the benefits of investing in gold paper as opposed to holding it as jewellery.
ETFs are instruments that trade like shares and are backed by physical holdings of the commodity.
India is the world's top consumer of gold, accounting for 20 percent of global demand. In a country where many of the 1.2 billion population live far from a bank, Indians traditionally invest in gold jewellery.
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Source: Reuters
HKEx looks to mainland joint venture
August 18, 2011--Hong Kong Exchanges & Clearing, the world’s largest bourse operator by market value, plans to form a joint venture with its counterparts in Shanghai and Shenzhen in a move that would mark the most significant commercial link between the three exchanges.
Thursday’s announcement came a day after Li Keqiang, the Chinese vice-premier, unveiled measures to boost Hong Kong’s role as a financial centre and widen the channels for money to flow between the city and the mainland.
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Source: FT.com
ASIC Consults On Consequential Market Integrity Rules For ASX And Chi-X Markets
August 17, 2011--ASIC today released Consultation Paper 166 Market integrity rules: non-AFS licence foreign participants and consequential amendments (CP 166).
Consultation Paper 166 proposes market integrity rules for the ASX and Chi-X markets, and seeks views on:
certain minimum presence requirements for foreign participants not required
to hold an Australian financial services (AFS) licence (non-AFS licence foreign participants) trading on the ASX and/ or Chi-X markets; and
minor consequential amendments to the ASIC Market Integrity Rules (ASX Market) 2010 and the ASIC Market Integrity Rules (Chi-X Australia Market) 2011, resulting from the introduction of the competition market integrity rules, in particular amendments to:
restrictions related to crossings and trading outside of normal trading hours during takeovers and buybacks to ensure that existing restrictions operate effectively;
the prohibition on dealing during a trading suspension; and market participant restrictions relating to client instructions.
view CP 166 Market integrity rules: non-AFS licence foreign participants and consequential amendments
Source: ASIC
Hong Kong ETF planned for mainland investors
August 17, 2011-- Beijing plans to unveil an exchange-traded fund that will enable mainland China investors to access stocks listed in Hong Kong, according to a package of measures unveiled Wednesday by Vice Premier Li Keqiang.
Li, speaking at a forum in Hong Kong midway through a three-day visit, mentioned the ETF along with several other measures to boost the city’s role an offshore hub for the use of the Chinese currency, the yuan.
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Source: Marketwatch
ASIC publishes ETF information for investors
August 16, 2011--ASIC today published new information on its consumer finance website, MoneySmart, to help consumers understand the different types of Exchange Traded Funds (ETFs), and their risks.
ETFs can provide a convenient and low-cost way for investors to diversify and receive returns close to the performance of market indexes or other assets, usually with lower fees than traditional managed funds.
But while standard, ‘physical’ ETFs generally invest in the underlying investments they are designed to track, ‘synthetic’ ETFs also use derivatives, such as swap agreements, to achieve similar outcomes. Benefits to investors of synthetic ETFs may include access to new and varied asset classes and low performance ‘tracking error’. Downsides include increased complexity and counterparty risk.
Standard ETFs are widely available in Australia. A few synthetic ETFs are currently available in Australia and they are increasingly available overseas.
ASIC Chairman Greg Medcraft said: ‘ETFs are growing in popularity and people should understand the different features and risks of ETFs before investing. We want investors to be informed and confident if investing in ETFs so therefore ASIC has published clear and straight forward information at www.moneysmart.gov.au to help investors understand these products. While conventional ETFs are often relatively straight forward, there are complexities and risks to be aware of. Furthermore, the use of derivatives by synthetic ETFs creates separate additional issues for investors to consider. Either way, people should not invest in products they don’t understand.
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Source: ASIC
DB - Equity Research - Asia Pacific ETF Weekly Review: ETF turnover soars in the middle of declining markets
August 15, 2011--Market Review
Asian markets declined for the third week in a row as fear continues on weakening global economic recovery amid Europe’s debt crisis concerns and fall in U.S. credit rating.
In all, Japan (Nikkei 225) dropped by 3.61%, Korea(KOSPI2) sank by 8.54%, China (CSI 300) decreased by 0.76%, Hong Kong (HSI) dropped by 6.33%, Singapore (FSSTI) declined by 4.81%, while Australia(S&P/ASX 200) gained 1.64% over the previous week.
New Launch Review
After one week of silence, another new product was added in the Asia-Pacific market last week. Chinese issuer GF Fund Management Co Ltd entered the ETP market with the listing of its Guangfa SZSE Small and Mid Cap Enterprises 300 Price Index ETF on Shenzhen Stock Exchange tracking SZSE Small and Mid Cap Enterprises 300 Price Index.
Turnover Review: Volatile markets took trading activity to the new heights
Asia-Pacific market collected total weekly turnover of $14.5bn last week, 81.2% above previous week, and 204% up from last year’s weekly average. This was primarily aided by the ETPs tracking Kospi 200 Index and its inverse and leveraged versions as the index experienced sharp decline in the last week. South Korea topped the turnover ranking with a record $6.4bn (up 108%) followed by Hong Kong ($2.9bn, up 45.2%), Japan ($1.9bn, up 56.9%), China ($1.8bn, up 119.7%), and Taiwan ($721.9m, up 58.7%).
Among Equity ETPs, Emerging Country, Leveraged Strategy, Short Strategy and Asia Pac Developed Country ETPs experienced significant week-over-week rise in turnover of $2.1bn (59.9%), $1.9bn (144.6%), $1.2bn (214.4%) and $989m (49.8%) respectively. On the Commodities section Gold ETPs activity also increased by 97.2% totaling $453m for the last week.
Assets Under Management Review
Amid volatile markets, Asia-Pacific ETP AUM remained technically flat on a week-over week basis and ended at $89.9bn last week. However, on a year to date basis, Asia-Pacific ETF market is $5.7bn or 6.8% above last year's closing.
to request report
Source: Deutsche Bank - Equity Research - Asia
After NSE, USE to impose charge on currency derivatives trade
August 15, 2011--The United Stock Exchange (USE), which has premier bourse BSE as its largest shareholder, has said it will soon take a call on imposing service charges on currency derivatives trading.
"We welcome the decision by the NSE and we will take a call on imposing charges soon. Our board will meet by the last week of this month to decide on this," USE Managing Director and Chief Executive T S Narayanaswami told PTI here.
Source: The Economic TImes India
Japan’s GDP shrinks less than expected
August 15, 2011--Japan’s economy contracted for a third consecutive quarter, reflecting the continued impact of the country’s biggest disaster since the second world war.
Gross domestic product fell 0.3 per cent in the April-June quarter on a seasonally adjusted basis from the previous quarter, due to a sharp drop in net exports following the March 11 earthquake and tsunami. That translated into a 1.3 per cent decline on an annualised basis, according to government figures released on Monday.
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Source: FT.com
After takeover,will Benchmark grow?
Goldman Sachs is expected to pump in money to help Benchmark’s ETFs widen their reach. For investors, this means they can continue to hold their units, but exit is easy too
August 14, 2011--Nothing seems much different as you walk into the cramped office of Benchmark Asset Management Co. (AMC) Ltd at one of Mumbai’s oldest business district at Nariman Point. A nondescript reception quite unlike any in the Rs. 7 trillion Indian mutual funds (MF) industry, a dusty sofa that gives you a feeling you’re sinking in as soon as you sit on it, an office security guard doubling up as a receptionist,
cramped cubicles, a casual dress code with shirts hanging out and just a few jackets hung over chairs; that’s as formal as things get here. But life is set to take a 180 degrees turn for the 50 employees of this fund house.
Goldman Sachs, the US-based fund house that manages assets worth $844 billion (Rs. 38.29 trillion) globally has just acquired it. India’s first fund house to focus only on exchange-traded funds (ETF) has now moved to a big league. The exit option for investors to withdraw without paying an exit load expired on 10 August. For those who missed the exit opportunity, is it too late? Or should you rather hold on? Read on to find out.
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Source: livemint.com
Thai Bourse Lists ThaiDEX SET High Dividend ETF On August 16
August 11, 2011--The Stock Exchange of Thailand (SET) will list ThaiDEX SET
High Dividend ETF, managed by One Asset Management Limited, on its main board on
August 16, under the ticker “1DIV.”
1DIV, an open-end exchange-traded fund (ETF), will mostly invest in constituent stocks of the SET High Dividend 30 Index (SETHD), thus reflecting the price movements of 30 stocks that have constantly paid high dividend yields.
“1DIV focuses on screened stocks which have had good dividend track records for three successive years to meet the demand of those who favor dividend shares,” said SET President Charamporn Jotikasthira.
As at the end of June 2011, the average dividend yield of the constituent stocks of SETHD was 4.28 percent, compared with 3.75 percent of the overall market. Monrat Phadungsit, President of One Asset Management, said: “This ETF received great attention from both institutional and retail investors during its IPO early this month. It initially raised THB 189.09 million and has a price per unit of THB 10.5049. We believe 1DIV should grow continuously and follow the success of the ThaiDEX SET50 ETF.”
KGI Securities (Thailand) PCL is participating dealer and market maker and Thailand Securities Depository Co., Ltd. is registar for 1DIV.
Currently, the four ETFs listed on Thailand’s stock exchange are KTAM Gold ETF Tracker (GLD), tracking the price of gold; MTRACK ENERGY ETF (ENGY), with the SET Energy & Utilities sector index as the underlying index; ThaiDEX SET50 ETF (TDEX), a SET50 market-weighted index; and W.I.S.E KTAM CSI 300 China Tracker (CHINA), tracking
W.I.S.E.-CSI 300 China Tracker.
Source: Stock Exchange of Thailand (SET)
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