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New Strategy indices launched for STOXX and DAX index families
September 29, 2010--STOXX Limited, a global index provider and creator of the leading European equity indices, today announced the launch of the EURO STOXX 50 Monthly Leverage and EURO STOXX 50 Monthly Double Short indices, and the LevDAX x2 (monthly) and ShortDAX x2 (monthly) indices. The new indices replicate leveraged and short investment strategies based on a monthly rebalancing methodology.
The EURO STOXX 50 Monthly Leverage, EURO STOXX 50 Monthly Double Short, LevDAX x2 (monthly) and ShortDAX x2 (monthly) indices are designed to underlie financial products such as exchange-traded funds (ETFs) and structured products.
“The new EURO STOXX 50 Leveraged and Double Short indices and LevDAX and ShortDAX x2 monthly indices enable market participants to track investment strategies based on their bullish and bearish sentiments on European and German equities,” said Hartmut Graf, chief executive officer, STOXX Ltd. “The new indices complement the existing daily leverage and short indices on the EURO STOXX 50 and the DAX by allowing investors to bypass daily market fluctuations and take a more long-term approach. Furthermore, product issuers and their customers also benefit from reduced transaction costs, as portfolios would only have to be balanced once a month instead of on a daily basis.”
The EURO STOXX 50 Monthly Leverage Index is linked to the monthly performance of the EURO STOXX 50 Net Return Index – measured as of the third Friday of the month - in a leveraged way: A positive performance of the EURO STOXX 50 Index results in twice the positive performance of the EURO STOXX 50 Monthly Leverage Index, and vice versa. The EURO STOXX 50 Monthly Double Short Index replicates a short investment strategy that is inversely linked to the monthly performance of the EURO STOXX 50 Gross Return Index, also as of the third Friday of the month. A negative performance of the blue-chip index results in a positive change of twice the performance the EURO STOXX 50 Monthly Double Short Index, and vice versa.
The LevDAX x2 (monthly) also rises and falls twice as much as the performance of the DAX index, thus providing an effective and innovative strategy for magnifying participation in market movements. The ShortDAX x2 (monthly) measures double the negative monthly performance of the DAX index. Its performance is positive when the DAX falls. The index is designed for investors who expect negative performance on the DAX index or who are looking for an efficient hedge against falling prices.
The leverage factor is adjusted on a monthly basis to ensure that LevDAX x2 (monthly) always achieves twice the performance of the underlying index based on the closing level on the third Friday of the previous month. It complements the existing range of daily leveraged indices. However, if an investment is made between the monthly adjustment dates the leverage generally deviates from the factor 2.
The new STOXX and DAX strategy indices are calculated in euro. Daily historical index values are available back to December 31, 1991 for the EURO STOXX 50 Monthly Leverage and Short indices and back to December 30, 1987 for the LevDAX x2 (monthly) and ShortDAX x2 (monthly) indices. The cost of borrowing and the benefit of earning interest are also taken into account in the calculation of the new indices.
The EURO STOXX 50 Monthly Leverage and EURO STOXX 50 Monthly Double Short indices are part of the STOXX Strategy Index family. Further information on the new indices is available at www.stoxx.com.
The LevDAX x2 (monthly) and ShortDAX x2 (monthly) indices are part of the DAXplus family. Further information is available at www.dax-indices.com.
ETF Landscape: STOXX Europe 600 Sector ETF Net Flows, week ending 24-Sep-10
September 29, 2010--Last week saw US$306.2 Mn net outflows from STOXX Europe 600 sector ETFs. The largest sector ETF net outflows last week were in Banks with US$280.0 Mn and Industrial Goods & Services with US$40.5 Mn while Food & Beverage experienced net inflows of US$55.8 Mn.
Year-to-date, STOXX Europe 600 sector ETFs have seen US$272.0 Mn net outflows. Telecommunications sector ETFs have seen the largest net outflows with US$122.6 Mn, followed by Food & Beverage with US$92.4 Mn while Media has experienced the largest net inflows of US$193.8 Mn YTD.
The US$9.0 Bn AUM invested in the ETFs is greater than the US$3.7 Bn open interest in the sector futures. The ETF AUM is greater than the open interest in the corresponding futures contract in all 19 sectors.
Ten New Lyxor ETFs Launched on Xetra
September 29, 2010-- Deutsche Börse continues to expand its XTF segment for exchange-traded index funds. Ten new exchange-traded funds (ETFs) issued by Lyxor International Asset Management have been tradable in XTF since Wednesday.
The new ETFs track the performance of the world’s largest companies from the following sectors in the MSCI World Index family: Consumer Discretionary, Consumer Staples, Energy, Financials, Health Care, Industrials, Information Technology, Materials, Utilities and Telecommunication Services.
The acquisition of the new ETFs via Deutsche Börse does not involve a front-end load, and the annual total expense ratio is 0.45 percent.
The product offering in Deutsche Börse’s XTF segment currently contains a total of 717 exchange-listed ETFs, making it the largest offering of all European stock exchanges. This selection, together with an average monthly trading volume of around €14 billion, makes Xetra Europe’s leading trading venue for ETFs.
A list of the new exchange-listed Lyxor ETFs tradable in Deutsche Börse's XTF segment since 29 September is attached to this mail.
Istanbul bourse breaks new record
September 29, 2010-The Istanbul Stock Exchange benchmark index (IMKB-100) broke a new record yesterday at 3 p.m., when it surpassed 65,970 points.
The IMKB is still continuing to rise sharply. According to experts, there are two basic reasons for this consistent rise: the outcome of the public referendum and investor confidence, and the recently concluded International Finance Summit that was held in ?stanbul.
Centrally Cleared CFDs: The Buy-side Perspective
September 28, 2010--Executive Summary
A centrally cleared Contract-For-Difference (ccCFD) is a CFD/equity swap that is initiated as an over-the-counter (OTC) trade and is brought on-exchange and cleared through a central clearing counterparty (CCP) instead of as a bilateral agreement. Clearinghouses and execution facilities are entering the space to benefit from expected growth in CFDs, proposed regulatory changes, and address buy-side concerns surrounding OTC counterparty risk.
One of the first offerings in this space is LCH.Clearnet and Chi-X Europe, who will launch a unique ccCFD clearing service as a joint initiative in the fourth quarter of 2010, starting with FTSE 100 stocks. The CCP model effectively makes the CFD a standardised product that can trade multilaterally between counterparties while retaining the efficiencies of the OTC trading element. There is strong potential beyond UK shores as the initiative will be rolled out down the UK list and to Pan-European shares.
So-called retail aggregators, which sell CFDs to the retail market, will be drawn to the new service as they seek to mitigate possible future regulation requiring OTC CFD providers to set aside additional risk capital. UCITS III (Undertakings for Collective Investments in Transferable Securities III) funds, which use OTC CFDs for synthetic short exposure, will favour ccCFDs for reduced counterparty credit risk. Long-only asset managers who currently use single stock futures may also be drawn to the new ccCFD service because it provides an additional risk management tool that should fit with their fund mandates.
But large long/short hedge funds and absolute return hedge funds who make up the bulk of the existing market will not initially use the service. This is because a CCP model introduces anonymity and eliminates the special relationship and beneficial pricing structure large hedge funds currently enjoy with incumbent prime brokers providing OTC CFDs. In order to migrate to the service, their hand will have to be forced by new regulation.
Deutsche Börse Commodities launches Xetra-Gold in the UK
September 28, 2010--Today, Deutsche Börse Commodities
GmbH
launched Xetra-Gold in the UK. Xetra-Gold is an exchange-traded security in
the form of a bearer note (ISIN: DE000A0S9GB0) which is always 100 percent
backed by gold. Each unit of the Xetra-Gold bearer note grants investors the right to demand the delivery of one gram of gold from the issuer. Deutsche Börse Commodities’
gold reserve for Xetra-Gold is currently around 50 tons – valued at around € 1.6 billion at current prices.
Private investors can have the physical gold delivered to their bank and receive it there personally. In Germany, more than 400 private investors have taken this option to date.
The international derivatives exchange Eurex has also started offering futures and options on Xetra-Gold as of 28 September due to the high level of market interest in this contract. The Xetra-Gold ETC can be deposited as collateral with Eurex Clearing, Europe’s largest central counterparty, since 27 August.
Xetra-Gold conforms with European provisions for securities investment (UCITS directive), and can thus be suitable for institutional investors and investment funds too. “Our securitization provides private and institutional investors with access to the gold market and gives them a cost-effective portfolio diversification opportunity,” said Martina Gruber, Managing Director of Deutsche Börse Commodities GmbH. “In the UK, we expect demand to come predominantly from institutional investors,” she continued.
The stable and constant holdings are a competitive advantage of Xetra-Gold. There is no front-end load for investments in this gold ETC (exchange-traded commodity) and Deutsche Börse Commodities does not charge any ongoing management fees which would deplete the investor’s gold holdings. “If an investor buys 10,000 units of Xetra-Gold today, we will still be holding exactly 10 kilograms of gold in custody in 10 years’ time too,” said Steffen Orben, Managing Director of Deutsche Börse Commodities GmbH. Xetra-Gold is only subject to custody fees that are reported separately. They amount to 0.36 percent annually of the value under custody. It depends on the contract between the custodian bank and the buyer of Xetra-Gold to which amount the bank passes on these charges.
Xetra-Gold is exchange-listed in Deutsche Börse’s ETC segment and is tradable on the pan-European Xetra platform as a highly liquid security. When buying or selling, investors benefit from the transparent pricing and favorable conditions of stock exchange securities trading. The price of one Xetra-Gold bearer note is always exactly the same as the price of one gram of gold on the world market in euros. On the Xetra trading platform, the spread between the bid and ask price of Xetra-Gold is generally around 0.1 percent – a maximum of 1 percent is permitted.
Since its launch in Germany in December 2007, Xetra-Gold has had by far the
highest order book turnover in Deutsche Börse’s ETC segment (178 products).
The gold order book volume on Xetra was around €1.2 billion in the first six
months of 2010 – a market share of 37 percent in the commodities segment of the Xetra trading platform.
STOXX Licenses Four Sector Strategy Indexes To Underlie Exchange-Traded Funds
September 28, 2010--STOXX Limited, a global index provider and creator of the leading European equity indices, today announced that the STOXX Europe 600 Oil & Gas Daily Short, STOXX Europe 600 Basic Resources Daily Short, STOXX Europe 600 Banks Daily Short and STOXX Europe 600 Automobiles & Parts Daily Short indices have been licensed to Lyxor Asset Management to underlie four exchange-traded funds (ETFs). The new ETFs are available today on NYSE Euronext (Paris).
“The STOXX Europe 600 Supersector Daily Short Indices are effective tools for investors aiming to track the performance of bearish viewpoints on specific sectors within the European equity markets,” said Hartmut Graf, chief executive officer, STOXX Ltd. “The indices’ innovative, rules-based and transparent methodologies enable market participants to further diversify their portfolio with sophisticated investment strategies.”
“Lyxor is strengthening its offering on sector indices. The four new ETFs are exposed to some of the most traded European sectors and give investors an efficient tool for their tactical asset allocation,” said Isabelle Bourcier, global head of Lyxor ETFs. “Lyxor offers the most on-exchange traded range of sector ETFs in Europe.”
Launched in October 2007, the STOXX Europe 600 Supersector Daily Short Indices are based on the STOXX Europe 600 Supersector Indices, which represent the largest European companies in each of the 19 supersectors defined by the Industry Classification Benchmark (ICB).
The STOXX Europe 600 Supersector Daily Short Indices are inversely linked to the daily performance of the STOXX Europe 600 Supersector Gross Return Indices. A negative performance of a STOXX Europe 600 Supersector Gross Return Index results in a positive performance of the respective STOXX Europe 600 Supersector Daily Short Index, and vice versa. The cost of borrowing and the benefit of earning interest are also taken into account in the calculation of the indices.
The STOXX Europe 600 Supersector Daily Short Indices are part of the STOXX Strategy Index family. Further information on the STOXX Strategy Indices is available at www.stoxx.com.
XACT Fonder AB: Record listing of eight new Nordic ETFs from XACT
September 28, 2010--The new ETFs are XACT Nordic 120, which tracks the NASDAQ OMX index consisting of the
120 largest and most traded Nordic companies, and seven sector ETFs tracking the largest listed Nordic companies within the sectors bank & insurance, material, construction &
real estate, energy, consumer goods, health care and industrials.
"With our new listing, we will now be able to meet the increasing demand for ETFs with
exposure to Nordic companies," says Henrik Norén, Managing Director of XACT Fonder, the
world's largest provider of ETFs with a Nordic focus.
ETFs are one of the fastest growing investment forms in the world. XACT's new ETFs offer unprecedented opportunities for investors with a focus on the Nordic market.
The new sector-ETFs offer investors the possibility to create a portfolio according to their own market view on key sectors in the Nordic economies.
XACT's ETFs track NASDAQ OMX's Nordic sector indices, with the largest Nordic companies within the selected sectors.
"The new ETFs are aimed at all types of investors and are also attractive to retail investors, who can now take positions in selected sectors and diversify their exposure
to risk," says Jenny Rosberg, Executive Vice President at Nasdaq OMX.
The following eight new ETFs will be listed on the Nasdaq OMX Nordic on September 29:
XACT Nordic 120 (the 120 largest and most traded Nordic companies)
XACT Bank(the largest Nordic banking and insurance companies)
XACT Materials (the largest Nordic companies, within the material sector)
XACT Construction & Real Estate (the largest Nordic construction and real estate companies)
XACT Energy (the largest Nordic energy companies)
XACT Consumer Goods (the largest Nordic consumer goods companies)
XACT Health Care (the largest Nordic health care companies)
XACT Industrials (the largest Nordic within the industrial sector)
The ETFs are registered in Luxembourg.
HSBC Launches MSCI Far East ETF
September 28, 2010--HSBC has bolstered its ETF range with the addition of a fund providing exposure to the Far East.
The HSBC MSCI EM Far East ETF, which has a total expense ratio of 0.60%, uses physical replication to track the underlying index by purchasing the constituent stocks.
The underlying MSCI EM Far East index represents the equity market performance of the largest companies in China, based on the Hong Kong market, as well as Indonesia, Korea, Malaysia, Philippines, Taiwan and Thailand.
Three New iShares ETFs Launched in the XTF Segment on Xetra
September 28, 2010--Three new exchange-listed equity index funds issued by iShares (BlackRock Inc.) have been tradable in Deutsche Börse’s XTF segment since Tuesday.
ETF name: iShares MSCI Australia
Asset class: equity index ETF
ISIN: DE000A1C2Y78
Total expense ratio: 0.59 percent p.a.
Distribution policy: non-distributing
Benchmark: MSCI Australia
Trading currency: euro
ETF name: iShares MSCI Canada
Asset class: equity index ETF
ISIN: DE000A1C2Y86
Total expense ratio: 0.59 percent p.a.
Distribution policy: non-distributing
Benchmark: MSCI Canada
Trading currency: euro
ETF name: iShares MSCI South Africa
Asset class: equity index ETF
ISIN: DE000A1C2Y94
Total expense ratio: 0.74 percent p.a.
Distribution policy: non-distributing
Benchmark: MSCI South Africa
Trading currency: euro
The three new iShares ETFs enable investors to track the performance of companies from Australia, Canada and South Africa. The reference indices from the MSCI index family are weighted according to market capitalization and free float. These are net total return indices, i.e. net dividends are reinvested after deduction of incurred taxes.
The product offering in Deutsche Börse’s XTF segment currently contains a total of 707 exchange-listed ETFs, making it the largest offering of all European stock exchanges. selection, together with an average monthly trading volume of around €14 billion, makes Xetra Europe’s leading trading venue for ETFs.
