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New ETFs from L&G on Xetra: access to Gerd Kommer's global portfolio concept as well as high quality companies from the UK and emerging markets
June 21, 2023--Since Wednesday, four new exchange-traded funds issued by Legal & General Investment Management have been tradable on Xetra and via Börse Frankfurt.
For the first time, the L&G Gerd Kommer Multifactor Equity UCITS ETF offers investors the opportunity to invest in companies from developed and emerging markets that are selected according to Gerd Kommer's global portfolio concept.
The countries are weighted 50 per cent by market capitalisation and 50 per cent by economic growth, measured by gross domestic product (GDP). In particular, this aims to reduce the so-called cluster risk of the US market. The ETF also takes a multi-factor approach by overweighting the factor premiums size, value, quality, investment and momentum. Investors can choose between a distributing and an accumulating share class.
With the two L&G Quality Equity Dividends ESG Exclusions UCITS ETFs, investors participate in the performance of high-dividend companies that have high profitability. Companies that do not meet certain ESG criteria are excluded. You can choose from companies from the United Kingdom and emerging markets.
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Source: Xetra
Solactive Partners with LGIM and Investment Expert Gerd Kommer to Launch Solactive Gerd Kommer Multifactor Equity Index
June 21, 2023-Solactive, in collaboration with Legal & General Investment Management (LGIM) and renowned German investment expert Gerd Kommer, is excited to announce the launch of the Solactive Gerd Kommer Multifactor Equity Index.
This index, built upon a sophisticated multifactor optimization strategy and a comprehensive global markets universe, aims to provide investors with exposure to the equity market in both developed and emerging countries as well as small-, medium- and large-caps. The Solactive Gerd Kommer index consists of around 5,000 stocks. The weights of stocks are tilted towards undervalued, more profitable and lower-capitalisation stocks.
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Source: Solactive
UK government debt rises above 100% of GDP for first time since 1961
July 21, 2023--In blow to Rishi Sunak's plans to cut taxes before general election, net debt reached £2.6tn at of end of May
The UK's total government debt pile in May reached more than 100% of annual national income for the first time since 1961 as state borrowing more than doubled, according to official figures.
In a blow to Rishi Sunak's plans to cut taxes before the general election, which is expected next year, the Office for National Statistics (ONS) said net debt reached £2.6tn as of the end of May, estimated at 100.1% of gross domestic product (GDP).
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Source: theguardian.com
IMF Working Paper-Firm Leverage and Boom-Bust Cycles
June 16, 2023--Summary:
This paper explores the dynamic relationship between firm debt and real outcomes using data from 24 European economies over the period of 2000-2018. Based on macro data, it shows that a rise in credit to firms is associated with an increase in employment growth in the short-term, but employment growth declines in the medium-term. This pattern remains similar, even when the changes in credit to households are accounted for.
Next, using data from a large sample of firms, it shows that firm leverage buildups predict similar boom-bust growth cycles in firm employment: Firms with a larger increase in leverage experience a boost in employment growth in the short-term, but employment growth decreases in the medium-term. Relatedly, the volatility of employment growth increases in the aftermath of firm leverage buildups. Finally, this paper provides suggestive evidence on the role of a financial channel in the relationship between firm leverage buildups and employment growth. The results show that a rise in firm leverage is associated with a persistently higher debt service ratio, pointing the drag on finances. Consistently, boom-bust growth cycles in the aftermath of firm leverage buildups are not limited to employment growth, but are also pronounced for investment. Moreover, the medium-term decline in firm employment growth as predicted by leverage buildups becomes even larger if aggregate financial conditions tighten. The findings are in favor of "lean against the wind" approach in policy making.
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Source: imf.org
ETFGI reports the ETFs industry in Europe gathered net inflows of US$7.93 billion during May
June 15, 2023 — ETFGI, a leading independent research and consultancy firm covering trends in the global ETFs ecosystem, reported today that ETFs industry in Europe gathered net inflows of US$7.93 billion during May, bringing year-to-date net inflows to US$61.89 billion.
During the month, assets invested in the European ETF/ETP industry decreased by 1.4% from US$1.58 trillion at the end of April to US$1.56 trillion, according to ETFGI's May 2023 European ETFs and ETPs industry landscape insights report, the monthly report which is part of an annual paid-for research subscription service. (All dollar values in USD unless otherwise noted.)
Highlights
ETFs industry in Europe gathered net inflows of $7.93 Bn in May.
YTD net inflows in 2023 of $61.89 Bn are third highest on record, after YTD net inflows of $95.18 Bn in 2021 and YTD net inflows of $68.77 in 2022.
8th month of consecutive net inflows.
Assets of $1.56 Tn invested in ETFs industry in Europe at the end of May.
Assets increased 9.9% YTD in 2023, going from $1.42 Tn at end of 2022 to $1.56 Tn.
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Source: etfgi.com
ECB raises rates to 22- year high and signals more to come
June 15, 2023--The European Central Bank raised interest rates for the eighth successive time as expected on Thursday and signalled further policy tightening, as it battles high inflation.
The ECB has now increased borrowing costs by a combined 4 percentage points in a year, its fastest pace on record, but a peak is now clearly in sight and the debate is slowly shifting to how long rates will need to be kept at current levels.
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Source: reuters.com
Deutsche Borse welcomes Valour as new crypto ETN issuer on Xetra
June 15, 2023--Since Thursday, the first crypto ETN of the issuer Valour Digital Securities Limited has been tradable on Xetra and via Börse Frankfurt.
With the 1Valour Bitcoin Physical Carbon Neutral, investors can invest in the performance of the cryptocurrency Bitcoin in a climate-friendly way.
The carbon footprint associated with Bitcoin is neutralised through certified carbon removal and offsetting initiatives.
The crypto ETN is physically backed by Bitcoin and is centrally cleared in trading by Deutsche Börse Group's central counterparty, Eurex Clearing AG.
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Source: Xetra
ESMA publishes latest edition of its newsletter
June 14, 2023--The European Securities and Markets Authority (ESMA), the EU's financial markets regulator and supervisor, has today published its latest edition of its Spotlight on Markets Newsletter.
Your one-stop-shop in the world of EU financial markets focused in May on various important topics such as the European Supervisory Authorities (ESAs) Progress Reports on Greenwashing and mainly on ESMA's key findings.
For the first time, the ESAs agreed on a high-level understanding of the phenomenon. The ESMA Progress Report helps to better understand greenwashing and provides market participants and regulators with a shared reference point in dealing with it. ESMA assesses which areas of the sustainable investment value chain are more exposed to the risk of greenwashing. Our work on Sustainable Finance is described in this video.
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Source: ESMA
Swiss Exchange Hit by Worst Market Outage in Decade on Tuesday
June 12, 2023--The SIX Swiss Exchange is investigating Tuesday's technical glitch that caused the country's worst stock market outage in more than decade.
The Zurich-based exchange said it will release findings from its investigation in a couple of days.
"It was a technical issue," said Juerg Schneider, the Swiss exchange's head of media relations, without giving details about the specific nature of the problem. We can "definitely rule out that it was a hack," he said, adding that it was the first such disruption since 2012.
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Source: bnnbloomberg.ca
New ETF from WisdomTree on Xetra: access to renewable energy companies
June 12, 2023--Since Monday, a new exchange-traded fund issued by WisdomTree has been tradable on Xetra and via Börse Frankfurt.
With the WisdomTree Renewable Energy UCITS ETF, investors can invest in a portfolio of companies that are primarily positioned within the renewable energy value chain.
Some of the areas in which the companies operate include wind and solar energy, hydrogen, other renewable technologies and solutions aimed at developing a renewable energy market.
Companies that do not meet WisdomTree's ESG criteria are excluded.
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Source: Xetra