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NYSE Euronext European ETF Activity - December 2009
January 12, 2010--European ETF activity highlights:
* At the end of December, NYSE Euronext had 449 ETF s with 497 listings from 15 issuers. NYSE Euronext ETF s cover more than 290 indices including an extended range of assets and strategies (Equity, Fixed Income, Commodities, Short, Leverage, etc…).
* In 2009, the number of ETF s increased by more than 29% compared to end of 2008. At the end of December, NYSE Euronext European markets had registered 107 ETF listings and 6 delistings for the year 2009.
* Daily average turnover in December 2009 remained stable at just over €263 Million, while the daily average number of trades continued the strong 2009 upward trend, increasing from 5 378 to 6 074, or 12.94%, compared to December 2008.
* The median spread of all listed ETF s was 34.36 bps in December 2009, down from 71.03 bps in December 2008.
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Source: NYSE Euronext
Optimized Return and Security-ETFlab offers exchange-traded bond funds for Jumbo bonds
ETFlab iBoxx € Liquid Germany Covered Diversified-(ISIN: DE 000 ETF L35 9)
January 12, 2010--With the ETFlab iBoxx € Liquid Germany Covered Diversified, ETFlab Investment GmbH, the Munich specialist for exchange traded funds, provides access to the segment of the biggest and most liquid German covered bonds, also known as Jumbo Pfandbriefe. “The ETF allows investors to achieve more return than with a Government bond, without having to accept disadvantages as regards the security of the papers”, Andreas Fehrenbach, the managing director of ETFlab, points out. This is granted by the high requirements of the German Pfandbrief Act.
At the moment, 15 issuers with at least an AA rating are providing broad diversification of the fund. The return of the ETF is currently about 0.20% above the SWAP interest rate with an identical residual maturity. A nice result, which can be traced back, among others, to ETFlab’s consistent and lean fees policy. With an annual All-in-Fee of only 0.09 %, the ETFlab iBoxx € Liquid Germany Covered Diversified counts among the most favourable ETFs worldwide.
A maximum of up to 30 so-called Jumbo bonds qualifies for the underlying index. They must have an outstanding volume of at least Euro 1.0 billion and a residual maturity between 1.5 and 10.5 years. In order to guarantee high liquidity, only papers that have been in the market for maximally four years since their issue will be considered.
Due to experiences made during the financial crises there are further security requirements. The maximum number of bonds by which an issuer is represented in the index may not exceed four, and the maximum weight of an issuer has been restricted to 15 percent. Any issuer must have a rating of at least BBB, whereby the weight of the bonds with this rating must not account for more than a total of 50 percent in the index. There are quarterly reviews as to whether the papers contained in the index meet these criteria. “This is to avoid risk concentration and to ensure that trade goes on smoothly even in difficult periods”, Andreas Fehrenbach explains.
The new exchange traded fund follows the approach of full replication, i.e. the respective papers are bought into the fund directly. In the past, the duration period was constantly between 3.5 and 4 years. Trade on the German stock exchange will start on January 12, 2010.
Source: ETFlab
Rendite und Sicherheit optimiert-TFlab bietet Renten-ETF auf Jumbo-Pfandbriefe
ETFlab iBoxx € Liquid Germany Covered Diversified -(ISIN: DE 000 ETF L35 9)
12. Januar 2010. Der Münchener Spezialist für börsengehandelte Indexfonds, die ETFlab Investment GmbH, ermöglicht mit dem ETFlab iBoxx € Liquid Germany Covered Diversified Zugang zum Segment der größten und liquidesten deutschen Pfandbriefe, auch als Jumbo-Pfandbriefe bekannt. „Damit können Investoren mehr Rendite als bei einer Bundesanleihe erzielen“, hebt Andreas Fehrenbach, Geschäftsführer von ETFlab, hervor, „ohne Abstriche bei der Sicherheit der Papiere hinnehmen zu müssen.“ Dies ist durch die hohen Anforderungen des deutschen Pfandbriefgesetzes gewährleistet.
Momentan sorgen 15 Emittenten mit mindestens „AA“-Rating für eine breite Diversifizierung des Fonds. Die Rendite des ETF liegt derzeit um 0,20% über dem SWAP-Zinssatz mit identischer Restlaufzeit. Ein schönes Ergebnis, das unter anderem auf die konsequent schlanke Gebührenpolitik von ETFlab zurückzuführen ist. Mit einer jährlichen All-in-Fee in Höhe von nur 0,09 % zählt der ETFlab iBoxx € Liquid Germany Covered Diversified zu den günstigsten ETFs weltweit.
Für den zu Grunde liegenden Index qualifizieren sich bis maximal 30 so genannte Jumbo-Pfandbriefe. Sie müssen ein ausstehendes Volumen von mindestens 1,0 Mrd. Euro und eine Restlaufzeit zwischen 1,5 und 10,5 Jahren aufweisen. Um eine hohe Liquidität zu sichern, werden nur Papiere berücksichtigt, die höchstens vier Jahre seit Emission am Markt sind.
Aus den Erfahrungen der Finanzkrise gibt es weitere Sicherheitsanforderungen. Jeder Emittent darf nur mit höchsten vier Anleihen im Index vertreten sein und das maximale Gewicht eines Emittenten ist auf 15 Prozent beschränkt. Ein Emittent muss mindestens ein Rating von BBB aufweisen, wobei Anleihen mit diesem Rating insgesamt nur 50 Prozent Gewicht im Index ausmachen dürfen. Viermal jährlich wird überprüft, ob die im Index enthaltenen Papiere die Kriterien erfüllen. „So sollen Klumpenrisiken vermieden und sichergestellt werden, dass der Handel auch in schwierigen Phasen reibungslos läuft“, erläutert Andreas Fehrenbach.
Der neue Pfandbrief-ETF folgt dem Ansatz der vollen Replikation, das heißt, die entsprechenden Papiere werden direkt in den Fonds hinein gekauft. Historisch lag die Duration konstant zwischen 3,5 bis 4 Jahren. Der Handel an der Deutschen Börse wird am 12. Januar 2010 aufgenommen.
Source: ETFlab
New ETFlab Bond Index ETF Launched on Xetra
January 12, 2010--Another new listed bond index fund issued by ETFlab Investment GmbH, a subsidiary of DekaBank Deutsche Girozentrale, has been tradable on Xetra since Tuesday.
ETF name: ETFlab iBoxx EUR Liquid Germany Covered Diversified
Asset class: Bond index ETF
ISIN: DE000ETFL359
Management fee: 0.09 percent
Distribution policy: distributing
Benchmark: Markit iBoxx EUR Liquid Germany Covered Diversified
The index tracks the market for German Jumbo Pfandbriefe (mortgage bonds) and comprises up to 30 liquid bonds with a minimum issue volume of 1 billion euros. A maximum of four Pfandbriefe per issuer can be included in the index. The maximum weighting per issuer is limited to 15 percent.
The product offering in Deutsche Börse’s XTF segment currently contains a total of 550 exchange-listed index funds, making it the largest offering of all European stock exchanges. This selection, together with an average monthly trading volume of 10 billion euros, makes Xetra Europe’s leading trading venue for ETFs.
Source: Deutsche Börse
Treasury calls for more choice in business finance
January 12, 2010--Work to increase options for UK businesses in need of non-bank finance is the subject of a discussion document released by the Treasury today. The document seeks views on the barriers to more diverse financing for firms with the intention to introduce proposals for reform later in the year.
Financial Services Secretary to the Treasury, Paul Myners said:
“The extraordinary events in credit markets over the past two years have shown that the continued availability of any single form of business finance cannot be taken for granted. Right across the world, firms that had relied on loans from banks to finance their operations found themselves in a very difficult situation when bank lending contracted.
“Here in the UK, our large corporations have had a great deal of success in accessing finance directly from credit markets with a surge in corporate bond issuances. Smaller firms, however, have not been able to similarly replace bank lending by directly tapping financial markets or non-bank financing.
“A more diverse funding market, where large and mid-size firms can go directly to markets or have options other than banks when they are looking for support, would clearly be an advantage to the UK economy, not just in economic slowdowns.”
The Treasury announced its plans to publish a discussion paper on non-bank lending channels in December’s Pre-Budget Report. Today’s document focuses on a range of issues relating to business finance including:
credit assessment and monitoring;
corporate transparency;
transparency in the pricing of bank loans
UK investor preferences;
non-bank loan markets and high yield bond markets.
The document attempts to identify barriers to the development of these alternative sources of finance.
The Treasury is seeking feedback from interested parties, particularly the investor and business communities. To focus this, questions are identified throughout the document.
View the Discussion paper on developing non-bank lending channels for UK businesses
Source: HM Treasury
Greece taking steps to meet fiscal challenges: Van Rompuy
January 12, 2010--Greece is now taking steps to meet the "substantial" challenge posed by its huge debt and public deficit, the European Union's new permanent president said on Tuesday.
"Greece faces very substantial economic and fiscal challenges and it is a matter of common interest for the European Union as a whole and more particularly for the members of the eurozone that Greece manages to meet those challenges," Herman Van Rompuy told reporters during a visit to Athens.
Greece, which is mired in recession, has a public spending deficit that rose to 12.7 percent of output last year, far above the 3.0 percent ceiling permitted to countries sharing the euro currency.
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Source: EU Business
NASDAQ OMX Commodities and Nord Pool Spot Launch UK Power Market N2EX
January 12, 2010--NASDAQ OMX Commodities, a
business unit of The NASDAQ OMX Group (Nasdaq:NDAQ), and Nord Pool Spot today announced the successful launch of N2EX, its marketplace for
physical UK power contracts. The launch included a day-ahead auction
and a prompt market.
"After an intensive year of development and preparations with the UK
market participants, we are very pleased with the day-ahead auction
results and the volumes currently being traded on the first day of the
prompt market. The total traded volume on the day-ahead auction which
closed at 10:30 CET was 6,987 MWh. The prompt market is still open for
trading and the so far traded volumes have exceeded expectations," said
Hans Randen, director trading in Nord Pool Spot.
"The good start for the N2EX market solution in the UK power market bodes well for the later launch of the derivatives market," commented Geir Reigstad, head of NASDAQ OMX Commodities.
N2EX will establish a reference price based on the physical market. The reference price will be the basis for its planned derivatives market.
N2EX is the result of a market initiative to inject liquidity back into
the UK power market. In 2008, the Futures and Options Association (FOA)
selected a consortium bid from Nord Pool Spot AS and NASDAQ OMX
Commodities as a result of their extensive expertise. Nord Pool Spot
runs the largest physical power market in the world, while NASDAQ OMX
Commodities provides access to the world's largest power derivatives
exchange and one of Europe's largest carbon markets, together with Nord
Pool ASA.
For further information, please go to www.n2ex.com.
Source: NASDAQ OMX
Single Stock Dividend Futures Trading Launched with Société Générale as First Market Maker
January 11, 2010--The international derivatives exchange Eurex announced that trading of single stock dividend futures started today. For the first time, the pure dividend component of the underlying stocks of a benchmark equity index is available for exchange trading and clearing as a stand-alone product in Europe. The launch was supported by Société Générale, which provides two-way prices in all 25 products throughout the day in these new products.
Eurex recorded already first trading volume during the morning. The new futures contracts cover the annual dividends of 25 of the constituents of the European benchmark index Dow Jones EURO STOXX 50®. The exchange intends to list the remaining 25 constituents on 1 March 2010 and will continue to seek additional liquidity providers over the coming weeks.
Peter Reitz, member of the Eurex Executive Board, said: “Société Générale as first market maker in the new dividend futures will strongly contribute to the liquidity of these contracts from launch. Société Générale as one of the largest participants in the over-the-counter market in this asset class adds further credibility and acceptance to the new futures contracts that will likely attract significant investor interest going forward.”
Today’s launch extends the successfully introduced index dividend futures on the Dow Jones EURO STOXX 50, launched in June 2008. The Dow Jones EURO STOXX 50 Index dividend futures currently trades around 10,000 contracts daily, volume in 2009 was over 2.5 million contracts. Further dividend index futures are available for the indices DAX®, DivDAX®, Dow Jones EURO STOXX® Select Dividend 30 and SMI®.
Source: Eurex
Successful Business Development for Eurex Repo in 2009
Record results for EUR repo and GC Pooling markets in 2009
Expansion of GC Pooling planned to include secured financing in US dollars
January 11, 2010--Eurex Repo, a leading electronic marketplace for international repo trading and secured financing, continued to further grow last year. The volumes in the secured money market segment GC Pooling and the EUR repo market reached new record levels.
GC Pooling achieved €73 billion average outstanding volumes in 2009 on an annual basis. This volume development contributed to the annual growth rate (CAGR) of over 94 percent since its market launch in 2005.
Marcel Naas, Managing Director of Eurex Repo, said, “Our business model comprising anonymous electronic trading, central clearing and efficient collateral management via Clearstream really proved itself last year. The option of re-using collateral to generate refinancing capacity via the central bank was a particular contributing factor towards both the acceptance of the GC Pooling market and the stabilization of the money market, and helped our clients considerably in their liquidity management. The growth in volume in GC Pooling underscores the advantage of our solution; the rise in the number of participants in GC Pooling by almost 30 percent to the current 35 is further proof.”
The EUR repo market also recorded growth: Average outstanding volume in December 2009 was €99.4 billion, and for the year as a whole, €98.6 billion. Fifteen new participants joined in 2009, taking the total to 61. The CHF repo market remains slightly below the previous year’s high level.
Eurex Repo plans to further expand the GC Pooling market in 2010, and together with Clearstream, to launch new baskets with additional securities categories and currencies. Secured financing in US dollars is to be offered as soon as the end of January 2010.
Source: Eurex
Financial Stability Board Launches Peer Review On Compensation And Invites Feedback From Stakeholders
January 11, 2010--The Financial Stability Board (FSB) has launched a peer review of implementation of the FSB Principles for Sound Compensation Practices and their Implementation Standards. The Principles and Standards were endorsed by the G20 Leaders at their Summits in London in April 2009 and Pittsburgh in September 2009. In their Pittsburgh statement, G20 Leaders tasked the FSB “to monitor the implementation of FSB standards and propose additional measures as required by March 2010.”
The peer review on compensation will focus on the steps being taken or planned by FSB member jurisdictions to ensure effective application of the Principles and Standards, as well as progress to date in implementation by significant financial institutions.
A template (attached) to collect information from national authorities was distributed to FSB members in December 2009, and the responses will be analysed and discussed by the FSB. The initial review is to be completed by March 2010 and the report will be published.
As part of this review, we welcome feedback from financial institutions and other stakeholders on practical experiences in implementing the FSB Principles and Standards (or the respective national rules) – including descriptions of how compensation arrangements at financial institutions have changed in practice (governance, pay structures, risk adjustments), areas where implementation is proving challenging, and issues of consistency in regulatory responses across sectors and jurisdictions. Feedback can be submitted by 1 February 2010 to fsb@bis.org under the subject heading “FSB Thematic Peer Review on Compensation.” Individual submissions will not be made public.
view the FSF Principles for Sound Compensation Practices
view the FSB Principles for Sound Compensation Practices-Implementation Standards
Source: Financial Stability Board (FSB)
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