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Deutsche Bank acts as market maker in Eurex’s dividend option
June 29, 2011-The international derivatives exchange Eurex announced today that Deutsche Bank will serve as a market maker in the option on the EURO STOXX 50® Index Dividend future. Deutsche Bank is the first Permanent Market Maker in this product, providing continuous quotation in the order book. Since 1 June 2011, Eurex Exchange has been offering its Permanent Market Makers who fulfill predefined quote obligations in the option on EURO STOXX 50 Index Dividend future significant rebates until the end of 2012.
“We are pleased to have Deutsche Bank as a Permanent Market Maker as price transparency in the order book is one major precondition for the further success of our dividend option,” said Peter Reitz, member of the Eurex Executive Board. “With our option on the EURO STOXX 50 dividend future, investors can hedge the income streams from the dividends of the euro zone’s leading equity index and thus improve risk management of expected dividends in their portfolios.”
Eurex launched its dividend options in May 2010. So far in 2011, more than 270,000 options contracts were traded, while open interest is approximately 260,000 contracts.
The dividend options are part of Eurex’s dividend derivatives product suite, with the initial products introduced in June 2008. Year to date, in all dividend products approximately 20,000 contracts are traded daily; altogether more than 2.4 million contracts in 2011. Open interest stands at 1.6 million contracts currently, representing approximately 11 billion euros of notional dividend value.
Brussels wants 'Tobin' trading tax in Europe: EU sources
June 29, 2011--The European Commission is to call for a "Tobin" tax on financial transactions in Europe as part of a wide-ranging reform of the bloc's next seven-year budget, EU sources said Wednesday.
The move is part of a bid by the European Union's executive arm to enable the bloc to raise its own finance rather than depend on funding by EU states.
EU commissioners meeting on Wednesday "adopted a proposal on a tax on financial transactions," one of the sources close to the matter told AFP.
RTS and Moscow School of Management SKOLKOVO will establish the Sustainability Index
June 28, 2011--On June 27, 2011 a visiting meeting of representatives from the Committee on Corporate Social Responsibility of the Russian Union of Industrialists and Entrepreneurs, Moscow School of Management SKOLKOVO and RTS Stock Exchange took place.
As a result of the meeting RTS and SKOLKOVO have started working on a joint project for establishing and calculating the first Russian Sustainability Index.
The Index constituents list will include shares of Russian issuers traded on the organized stock market and selected on the basis of regularly published corporate and social responsibility reports (CSR).
According to the global practice CSR reporting allows companies to release information on their issues in the area of economy, environmental impact and social service. By publishing non-financial reports a company stresses the importance of its relationships with employees, customers, investors and local community and establishes that such relationships are a key to successful sustainable growth by the company.
Two large-scale tasks face the project participants. The first task is the development of criteria for selection of securities to be included in the calculation of the Index. To solve this task best world practices and expert opinions will be used. The second task is the development and promotion of sustainable growth idea as an important and integral part of companies daily activities.
Final results of the project will be presented in a month.
IMF-Luxembourg: Financial System Stability Assessment—Update
June EXECUTIVE SUMMARY: Luxembourg hosts a large international financial center that plays a pivotal role in its
economy and in European financial markets. Over the last two decades, the financial center has been the key driver of domestic economic growth, while also playing an important
role in European Union (EU) financial markets, with sizable shares in terms of fund domiciliation, primary bond listing, and private banking. The banking industry is mostly
foreign-owned and outward-oriented, and only a handful of banks are active in the domestic retail market.
The crisis exposed significant vulnerabilities in Luxembourg’s financial system, due primarily to large cross-border exposures to foreign parent banks. Bank balance sheets
contracted significantly during the crisis, mainly through reduced cross-border intra-group transactions, and a few bank subsidiaries failed on contagion from their parent groups. The
investment fund industry faced sizable redemptions at the peak of the crisis.
However, the effects of the crisis in domestic credit markets were muted, owing to the dual nature of the banking system, relatively low household indebtedness, and resilient housing markets.
view the Luxembourg: Financial System Stability Assessment—Update
Republic of Kazakhstan: Selected Issues
June 28, 2011-- I. KAZAKHSTAN: RESPONDING TO INFLATION1
Inflationary pressures in Kazakhstan have intensified with the rise of global commodity prices. Given the additional risks to prices from the rapid pace of economic recovery,
planned public expenditure increases, and strong capital inflows, a comprehensive policy response is needed to control inflationary pressures. In this regard, the NBK should continue
to gradually withdraw monetary accommodation, and clearly communicate the causes and outlook for inflation. In addition, hard-to-reverse fiscal outlays—particularly higher
wages—should be avoided, while administrative measures to control inflation should be used
cautiously and phased out over time in favor of existing social safety nets.
Further ahead, efforts should be undertaken to strengthen the transmission of monetary policy, improve
social safety nets, and enhance the economy’s supply response.
A. Background
1. The surge in global commodity prices has revived concerns about inflationary
pressures in Kazakhstan. Annual headline inflation increased to about 8½ percent in April, exceeding the official objective range of 6-8 percent for the fourth consecutive month. The
increase in inflation is largely attributable to the pass through of surging global food prices despite the wide use of administrative measures. Domestic food prices grew by 13½ percent
year-on-year in April, up markedly from 4¾ percent in July 2010 when the global food price shock began to emerge. Alternative measures of core inflation suggest, on balance, that high
food prices have been the main driver of inflation.
Doing Business in South East Europe 2011
June 28, 2011--Overview
Doing Business in South East Europe 2011—the second subnational report in the series following Doing Business in South East Europe 2008—compares the ease of doing business, both within a single economy and across the region, among 22 cities from: Albania, Bosnia and Herzegovina, Kosovo, FYR Macedonia, Moldova, Montenegro, and Serbia. The report focuses on national and local regulations that affect 4 stages in the life of a small to medium-size domestic firm: starting a business, dealing with construction permits, registering property and enforcing contracts.
Main Findings
It is easier to do business now in all cities, as compared to 2008 – all 19 cities measured for the second time show improvements in at least 1 of the 4 areas measured. Between January 2008 and January 2011, national and local governments carried out 48 reforms aimed at making it easier to start a business, strengthening property rights, rendering the process of dealing with construction permits more efficient, and improving the efficiency of commercial dispute resolution. As a result, the average cost to start a business across the region decreased from 23% to 13% of the average income per capita. Meanwhile, the average time to deal with construction permits and to register property decreased by more than one month.
Skopje (FYR Macedonia) and Banja Luka (Bosnia and Herzegovina) took top honors with the most improved business regulation in the past 3 years. They implemented business reforms in all 4 regulatory areas.
No single city outperforms the others across the board. Across the region, it is easiest to start a business in Skopje (FYR Macedonia), deal with construction permits in Niksic (Montenegro), transfer a property title in Balti and Chisinau (Moldova), and resolve a commercial dispute through the courts in Zrenjanin (Serbia). It is most difficult to start a business in Pristina (Kosovo), register property in Mostar (Bosnia and Herzegovina), and enforce a contract in Prizren (Kosovo). Dealing with construction permits is most burdensome in Belgrade (Serbia), while in Tirana (Albania) no permit has been issued since 2009.
Newly Launched Euro Stoxx 50 Volatility-Balanced Index Licensed to Barclays Capital
June 28, 2011--STOXX Limited, the market-moving provider of innovative, tradable and global index concepts, today announced that the newly launched EURO STOXX 50 Volatility-Balanced Index has been exclusively licensed to Barclays Capital.
The new index aims to provide improved risk-adjusted returns relative to the EURO STOXX 50 Index by replicating a hypothetical portfolio that combining a base investment into the EURO STOXX 50 Index with an investment into equity volatility, using the VSTOXX Short-Term Futures Index.
“As equity volatility historically shows negative correlation to the underlying equity market, it can serve as a valuable hedge in volatile times. The EURO STOXX 50 Volatility-Balanced Index, which is the latest addition to our range of innovative strategy indices, applies this concept in a novel, transparent and strict index methodology,” said Hartmut Graf, chief executive officer, STOXX Limited.
Benedict Redmond, director in equities and funds structuring at Barclays Capital, said: “With the prospect for continued macro uncertainty in Europe, the Euro STOXX 50 Volatility-Balanced Index allows investors to keep upside potential while mitigating possible equity losses with a single investment allocating dynamically to both European Volatility and European Equity.”
The EURO STOXX 50 Volatility-Balanced Index dynamically changes allocation to equity and volatility based on the prevailing market environment increasing the exposure to volatility during unstable periods, and conversely keeping a lower exposure during more stable or up-trending markets. The prevailing volatility environment is determined by comparing the market expectation of short-term volatility to the actual realized volatility in that period.
The VSTOXX Short-Term Futures Index is an investable volatility index that measures the returns from a rolling investment made into the first two VSTOXX futures contracts traded on EUREX.
The EURO STOXX 50 Volatility-Balanced Index is rebalanced daily and calculated at the end of each trading day at 7.15pm CET. It is available in euro.
For further information on this index, please visit www.stoxx.com.
London Stock Exchange tops global exchanges for Emerging Market ETFs
First exchange traded product to track FTSE Emerging EMEA 40 index launched by ETF provider, Source
London Stock Exchange world leader in listed Emerging Market ETFs
June 28, 2011--The London Stock Exchange today confirmed that it offers trading in more emerging markets exchange traded funds (ETFs) than any other exchange in the world. There were a total of 158 emerging market ETFs listed on the Exchange in May 2011 compared with 126 on the New York Stock Exchange (NYSE Arca) and 93 on Deutsche Boerse1.
The London Stock Exchange this week also welcomed a new exchange traded fund from leading ETF provider, Source. The FTSE Emerging EMEA 40 Source ETF is the first exchange traded product to track the FTSE Emerging EMEA 40 Index - both created in collaboration with BofA Merrill Lynch. The Index, calculated and managed by FTSE offers exposure to the 40 largest and most liquid stocks in the emerging countries of the European, Middle East and African (EMEA) region.
Pietro Poletto, Head of ETFs and ETPs at London Stock Exchange Group, said:
“The London Stock Exchange has long been a hub for emerging markets business, both in terms of issuance and investment. These figures prove that these credentials extend to our ETF offering, which is the largest in the world by emerging markets products. The Source ETF listing further enhances that range, offering investors exposure to a new index on a well established and highly liquid platform.”
Three new Amundi ETFs launched on Xetra
June 28, 2011--Three further exchange-listed index funds issued by Amundi have been tradable on Xetra since Tuesday.
ETF name: Amundi ETF Green Tech Living Planet
Asset class: equity index ETF
ISIN: FR0010949479
Total expense ratio: 0.45 percent
Distribution policy: non-distributing
Benchmark: Living Planet Green Tech Europe Index
ETF name: Amundi ETF Euro Corporate Financials iBoxx
Asset class: bond index ETF
ISIN: FR0011020957
Total expense ratio: 0.16 percent
Distribution policy: non-distributing
Benchmark: Markit iBoxx EUR Liquid Financials Index
ETF name: Amundi ETF Euro Corporate ex Financials iBoxx
Asset class: bond index ETF
ISIN: FR0011020940
Total expense ratio: 0.16 percent
Distribution policy: non-distributing
Benchmark: Markit iBoxx EUR Liquid Non-Financials Index
The two new bond index ETFs in the Amundi ETF Euro Corporate iBoxx series are based exclusively on corporate bonds denominated in euros with an investment grade rating. The underlying indices are total return indices and therefore reinvest dividends and distributions.
The Amundi ETF Euro Corporate Financials iBoxx enables investors to participate in the performance of the Markit iBoxx EUR Liquid Financials Index, which invests in bonds of financial companies operating under private law. By contrast, the Amundi ETF Euro Corporate ex Financials iBoxx focuses exclusively on bonds from private companies outside the financial sector.
The Amundi ETF Green Tech Living Planet aims to replicate as closely as possible the performance of the Living Planet Green Tech Europe Index. This admits only European equities traded in euros to the investment portfolio, which generate at least 20% of their turnover from activities relating to environmentally-friendly and sustainable technologies. The weighting of the individual equities is determined using a “green coefficient” and a single company has a maximum share in the index of 15%.
The product offering in Deutsche Börse’s XTF segment currently comprises a total of 819 exchange-listed index funds, making it the largest offering of all European stock exchanges. This selection, together with an average monthly trading volume of €13 billion, makes Xetra Europe’s leading trading venue for ETFs.
MTS licenses Italian government bond indices for Deutsche Bank ETFs
ETFs will be first to track Italian government debt market
July 28, 2011--MTS, Europe’s premier facilitator for the electronic fixed income market, today announced that it has licensed its benchmark Italian government bond indices to db X-trackers, Deutsche Bank’s exchange traded fund (ETF) platform.
The db X-trackers ETFs will be based on three MTS Italy ex-Bank of Italy Indices, including the MTS Italy BTP ex-Bank of Italy Index, the MTS Italy BOT ex-Bank of Italy Index and the MTS Italy Aggregate ex-Bank of Italy Index.
These indices are widely considered the best-in-class benchmark for the Italian fixed income market, ensuring the highest level of investor confidence. They are calculated using the accurate and proven EuroMTS index algorithm, which is available free of charge on the MTS website, allowing db X-trackers customers to monitor the performance of their investment in real-time.
Mauro Giangrande, Head of Financial Products for Italy at db X-trackers said: “Deutsche Bank continues to lead the way in the fast-evolving ETF market by offering the most appropriate instruments to meet investor demand. These new ETFs offer investors direct, efficient and low-cost access to the Italian debt market using the MTS Italy indices, the most representative benchmarks for this market.”
Jack Jeffery, CEO of MTS, said: “The launch of these new instruments by one of Europe’s top ETF providers is further recognition of the benchmark status and high quality that the EuroMTS index family delivers. Deutsche Bank’s expertise in the ETF market and our commitment to provide the most transparent and reliable benchmark will guarantee the popularity of these new products amongst investors.”
