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The long term is a good ally for investment in equities
BME report on historical returns for equities and other investment alternatives
October 5, 2010--THE LONG TERM IS A GOOD ALLY FOR INVESTMENT IN EQUITIES
The return on equities has risen a hundredfold in the last 30 years, outperforming long-term bonds by nearly 5 percentage points
Long-term investment in equities protects against inflation
The report provides a comprehensive analysis of the historical risk premium in Spain
An investment of €100 in the Spanish Stock Exchange’s Indice Total index in January 1980 would have been worth €9,254 at the end of June 2010, equivalent to a 16% annual return, according to a Report released by the BME Research Department analysing the returns of listed shares on Spain’s stock exchange over the last 30 years.
Reinvestment of dividends and other related income would add nearly five percentage points a year to this figure. A €100 investment in the same period in the – IGBM - (excluding dividends) would have risen to €2,539, a 10.7% annual gain.
“The study addresses three key topics: 1) the positive returns provided by long-term investment in equities and bonds; 2) the protection against inflation afforded by these returns; and 3) the historical equity risk premium in Spain, which measures the excess return over the long term of investment in equities over investment in a risk-free asset or a proxy for the risk-free rate” according to Domingo García Coto, Head of BME Research during the presentation of the report.
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Source: BME
UK official holdings of international reserves, September 2010
October 5, 2010--This monthly press notice shows details of movements in September in the UK’s official holdings of international reserves, which consist of gold, foreign currency assets and International Monetary
Fund assets. These reserves are maintained primarily so that the UK Government’s reserves could
be used to intervene to support Sterling, or the Bank of England’s reserves could be used to
support the Bank’s monetary policy objectives.
If such interventions were to occur, then they would be shown and explained in this release. The Background note at the end of this release
explains more about the reserves, and about these statistics.
In summary this month’s release shows that, in September 2010:
No intervention operations were undertaken.
Movements in reserves and levels of reserves were as follows:
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Source: HM Treasury
Unsettled market hinders carbon trader
October 5, 2010--Problems in the carbon markets have again hurt Trading Emissions, the Aim-listed specialist that is one of a dwindling band of pure-play carbon trading companies.
The company is divesting itself of chunks of its portfolio of carbon credits as the markets price in the risk that current forms of carbon trading may not be available beyond the next 18 months.
In the year to June 30, the company, which specialises in helping set up clean energy projects in the developing world that qualify for carbon credits, reported a narrowing of pre-tax losses from £232m to £29.9m, and revised downwards its forecasts for the next year.
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Source: FT.com
Europe pressures China as currency war bites
October 5, 2010--- Europe pressured China Tuesday to let the yuan rise as fears grew of a global "currency war" while a French call for a new, more stable world monetary order received short shrift from Germany.
A trio of top eurozone officials urged Chinese Premier Wen Jiabao to live up to a June vow to make the yuan more flexible to counter accusations Beijing deliberately undervalues its currency so as to boost exports and growth.
The call came as a two-day Asia-Europe Meeting (ASEM) gathering 46 nations wound up with a consensus for more effective global economic governance.
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Source: AME Info
ISE “Sustainability Index” Project Determines Sustainability Risks For Turkish Companies
Istanbul Stock Exchange (ISE) And Business Council For Sustainable Development Turkey Invited Turkish Companies And Turkish Investors To Assess Current Corporate Risks And Opportunities Associated With Sustainability Issues During A One Day Workshop Of The “ISE Sustainability Index” Project
October 4, 2010--Mrs. Esin Akbulut, Executive Vice Chairman of the Istanbul Stock Exchange opened the event by remarking on the increasing relevance of corporate sustainability programs to investment and the role of the ISE in promoting sustainability leadership amongst its listed companies.
“We believe that there is vast opportunity for the Turkish economy, and Turkish businesses that embrace the international standard for corporate sustainability practices. The development of a Sustainability Index for Turkey will provide investors, in Turkey and internationally, with new opportunities for favourable risk/return investments. The ISE Sustainability Index (ISESI) aims to provide a platform for Turkish companies demonstrating best practice in corporate sustainability to be profiled to investors. ISESI will enable Turkish and international investors to benchmark listed companies for their leadership in the development of sustainable business in Turkey. Turkish and international investors may use the ISESI as a tool to understand the importance of the management of sustainability for the short and long-term health of businesses.”
On the 10th of August 2010, Mr. Hüseyin ERKAN, Istanbul Stock Exchange Chairman & CEO, and Mr. Mehmet GÖÇMEN, Chairman of Business Council for Sustainable Development Turkey, signed a Memorandum of Understanding (MoU) in order to jointly create a new index offering significant opportunities for the capital markets, companies and investors, namely, “ISE Sustainability Index (ISESI)”.
Over 100 listed company members of the Istanbul Stock Exchange, their investors and stakeholders attended a Project Kick-off Workshop for the Sustainability Index Project which explored the state of corporate sustainability in Turkey – and related risks for Turkish companies. International experts involved in the project say that a growing number of investors are now convinced that sustainability is a catalyst for enlightened and disciplined management, and, thus, a crucial success factor for corporations show superior performance and favorable risk/return profiles. The inputs from this workshop will be used to design the ISE Sustainability Index over the next six months. Mr. Bjorn Stigson, President of the World Business Council for Sustainable Development (WBCSD), headquartered in Geneva, Switzerland, reminded the audience of Turkish companies and investors that, “the world is increasingly being defined by sustainability issues”, and “global CEOs are meeting today’s challenges by ensuring that their business models are robust enough to withstand the imminent shocks of a resource constrained world”. Mr. Stigson went on to commend the ISE and TBCSD for initiating the ISE Sustainability Index Project, which will identify corporate leaders in the management of sustainability in Turkey, and will provide an important market incentive that is more aligned with the future goals of sustainable development.
This workshop marks the first in a series of workshops planned for 2010 and 2011 by the Istanbul Stock Exchange Sustainability Index Project. The ISE Sustainability Index will be developed using a unique multi-stakeholder process design that will engage companies, investors and relevant stakeholders from the Turkish market in the development and agreement of the selection criteria for the index. The stakeholder process will be run by international experts Cheryl D. Hicks [Lead advisor on corporate sustainability] and Graham Sinclair [Lead advisor on sustainable investment]. Company assessments will be completed by a third party institution with conceptual input from Sustainable Asset Management (SAM), research provider of the Dow Jones Sustainability Indexes [DJSI].
The ISE Sustainability Index is planning its launch for the last quarter of 2011.
Source: Istanbul Stock Exchange (ISE)
db x-trackers hat zwei neue ETFs
October 4, 2010--db x-trackers hat zwei neue ETFs im Segment europäische Staatsanleihen an der Deutschen Börse gelistet:
den db x-trackers II iBoxx® € Sovereigns EUROZONE Yield Plus Index ETF, und
den db x-trackers II iBoxx® € Sovereigns EUROZONE AAA Total Return Index ETF
Die beiden Produkte erweitern die bestehende Palette an db x-trackers EURStaatsanleihen-
ETFs auf nunmehr zwölf Produkte, die verschiedene Marktsegmente
abbilden.
Beide ETFs haben eine Pauschalgebühr von 0,15 Prozent p.a. und sind an der
Frankfurter Börse auf Xetra handelbar. Die jeweils abgebildeten Indizes werden von der International Index Company Limited berechnet und veröffentlicht.
Der unterliegende Index für den ersten ETF, der iBoxx® € Sovereigns EUROZONE Yield Plus Index, bildet die Wertentwicklung eines Portfolios aus auf Euro lautende Staatsanleihen ab. Dabei handelt es sich um Staatsanleihen von den fünf Mitgliedstaaten der Eurozone mit der höchsten 5-jährigen Anleiherendite. Die Länder mit der höchsten Anleiherendite werden durch Berechnung der Rendite einer hypothetischen Anleihe mit einer Laufzeit von genau fünf Jahren ermittelt. Die Rendite der hypothetischen Anleihe wird anhand der Jahresrendite zweier Anleihen mit einer Laufzeit von ungefähr fünf Jahren berechnet. Die derzeitige Indexrendite beträgt 3,98 Prozent bei einer Duration von 6,31 Jahren. Derzeit bildet der Index Staatsanleihen der Länder Italien, Spanien, Belgien, Portugal und Irland ab. 1
Der zweite ETF ist an den iBoxx® € Sovereigns EUROZONE AAA Total Return Index gekoppelt. Dieser Index bildet die Wertentwicklung aller EUR-Staatsanleihen ab, die von Regierungen der Eurozone begeben werden und die über ein durchschnittliches Rating von „AAA“ verfügen. Die derzeitige Indexrendite beträgt 2,41 Prozent bei einer Duration von 6,62 Jahren. Die derzeit im Index enthaltenen Anleihen sind deutsche, französische, niederländische, österreichische, finnische und luxemburgische Staatsanleihen.2
Für beide Indizes müssen die jeweils abgebildeten Anleihen an den monatlichen Neugewichtungstagen eine Restlaufzeit von mindestens einem Jahr aufweisen, um in den jeweiligen Index aufgenommen werden zu können. Für alle Anleihen ist ein ausstehendes Volumen von mindestens zwei Milliarden Euro erforderlich.
„Diese beiden ETFs ergänzen unsere bereits breit gefächerte Produktpalette auf den Markt für europäische Staatsanleihen um zwei interessante Bausteine. Sie erlauben Investoren auf eine effiziente und einfache Weise in verschiedenen Segmenten des zunehmend heterogenen Markts europäischer Staatsanleihen aktiv zu sein und ihre Allokation gemäß dem jeweils gewünschten Risiko/Rendite-Profil anzupassen“, sagt Thorsten Michalik, verantwortlich für db x-trackers.
Wie bei allen ETFs der db x-trackers Palette wird auch bei den beiden neuen die Indexrendite synthetisch repliziert, mit dem Ziel, die Abweichung zum zugrunde liegenden Index (Tracking Error) auf ein Minimum zu reduzieren. Es ist geplant, mit Hilfe der Deutschen Bank als Market Maker die ETFs mit einem Maximum an Liquidität im Sekundärmarkt zu versehen. Im Rahmen des Market Makings wird darauf abgezielt, die Preisquotierungen grundsätzlich zuverlässig am fairen Wert des ETFs auszurichten.
Überblick über die neuen db x-trackers ETF
Name:db x-trackers II IBOXX € SOVEREIGNS EUROZONE YIELD PLUS INDEX ETF
Währung:EUR
Bloomberg Ticker:XY4P
ISIN: LU0524480265
Jährliche
Pauschalgebühr:0.15%
Index Bloomberg Ticker:IBOXEYP0
ETF
Name:db x-trackers II IBOXX € SOVEREIGNS EUROZONE AAA TOTAL
RETURN INDEX ETF
Währung: EUR
Bloomberg Ticker:XBAT
ISIN:LU0484969463
Jährliche
Pauschalgebühr:0.15%
Index Bloomberg Ticker: I8KW<
1 Quelle: Markit, Stand: 30. September 2010. (Wert-)Entwicklungen in der Vergangenheit sind kein
verlässlicher Indikator für die künftige (Wert-)Entwicklung.
2 Quelle: Markit, Stand: 30. September 2010. (Wert-)Entwicklungen in der Vergangenheit sind kein
verlässlicher Indikator für die künftige (Wert-)Entwicklung.
Source: db x-trackers
Boerse Stuttgart has a turnover of more than EUR 7.55 billion
Turnover up by more than seven percent overall/ Strong growth in equities trading
October 4, 2010--In September 2010 Boerse Stuttgart, according to its order book statistics, had a turnover of almost EUR 7.6 billion. The total trading volume was up by 7.2 percent in comparison with the previous month's figures. In total trading volume at the Stuttgart Stock Exchange amounted to almost EUR 70 billion between January and September.
At Europe's biggest marketplace for securitised derivatives this asset class accounted for a substantial proportion of turnover. In total Boerse Stuttgart's turnover in leverage and investment products amounted to more than EUR 4.1 billion in September. It is noticeable that investors are strongly favouring discount and bonus certificates. Trading volumes in these certificates were up by 30 and 33 percent respectively in a year-on-year comparison.
In bond trading last month's volumes amounted to more than EUR 2.1 billion. The bulk of this turnover was generated by corporate bonds. In this area the Stuttgart Stock Exchange had a trading volume of more than EUR 1.3 billion. Furthermore, Boerse Stuttgart also increased its turnover in federal government bonds (bunds), bonds issued by the German federal states and bonds of other European countries.
Boerse Stuttgart saw significant growth in equities trading in September. Trading volumes in this area amounted to almost EUR 841 million. The reasons for the strong growth of more than 23 percent include some recent capital increases and the issue of subscription rights for equities that go hand in hand with such increases. In September a number of large companies, among them Deutsche Bank, decided to increase their capital.
Source: Boerse Stuttgart
Trading firms sign up for cash equities protocol
September 4, 2010--Some of the largest banking firms in Europe have signed up to a protocol that covers banks and investment firms bilaterally trading cash equities if one firm fails.
The Association for Financial Markets in Europe, a trade lobby group, on Monday said it had agreed a legal framework that allows a signatory to strike a cash balance for open trades with a signatory that defaults.
Bank of America Merrill Lynch, Barclays, Deutsche Bank, Goldman Sachs, JPMorgan Securities, Morgan Stanley, Nomura and UBS have all signed up to the protocol.
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Source: FT.com
iShares launches the first currency hedged equity ETFs in Europe
Products launched as investor demand for currency hedged equity exposure grows
October 4, 2010--iShares, the Exchange Traded Funds (ETF) platform of BlackRock, Inc. (NYSE: BLK) today announces a new development in its European product set with the
launch of Europe’s first currency hedged equity ETFs. The new products enable investors to invest internationally and hedge currency exposure in one trade, without having to monitor and
maintain a currency hedge.
The five new physically-backed funds, which complement the iShares existing range of equity ETFs, have been launched on the London Stock Exchange (LSE) as a result of significant client
demand for currency hedged equity exposure. The launch takes the total number of iShares ETFs listed on the London Stock Exchange (LSE) to 94, the highest number of any provider in
the market.
The funds track some of iShares most popular and traded global indices offered by MSCI and Standard and Poor’s:
1. iShares MSCI Japan Monthly EUR Hedged
2. IShares MSCI World Monthly EUR Hedged
3. iShares MSCI World Monthly GBP Hedged
4. iShares S&P500 Monthly GBP Hedged
5. iShares S&P500 Monthly EUR Hedged
In line with market best practice, the indices incorporate a monthly currency hedge, with currency exposure hedged using one month forward FX contracts. The hedge is not adjusted during the month for price movements of securities, corporate actions or index changes, and reduces, rather than eliminates, currency exposure.
State Street Global Markets’ currency management team has been appointed to manage the currency hedge.
Axel Lomholt, head of product development, iShares EMEA, said: “These latest products – the first of their kind in Europe - provide investors with the opportunity to hedge against unintended and often undesirable currency risk, a consideration which is particularly important during periods of volatile currency fluctuations.
“All five funds act as the perfect complement to our existing range of equity products, and are in line with our strategy of offering investors the most compelling and diverse range of products with which to invest.
“We are particularly pleased to be able to offer these ETFs in a physically-backed structure
which remains our preferred means with which to develop product.”
Source: BlackRock
Two New db x-trackers II Bond Index ETFs Launched on Xetra
October 4, 2010-- Since Monday, two additional db x-trackers II bond index funds from Deutsche Bank’s ETF offering have been tradable on Xetra.
ETF name: db x-trackers II iBoxx EUR Sovereigns Eurozone AAA TRI ETF
Asset class: bond index ETF
ISIN: LU0484969463
Total expense ratio: 0.15 percent
Distribution policy: non-distributing
Benchmark: iBoxx EUR Sovereigns Eurozone AAA Index
ETF name: db x-trackers II iBoxx EUR Sovereigns Eurozone Yield Plus Index ETF
Asset class: bond index ETF
ISIN: LU0524480265
Total expense ratio: 0.15 percent
Distribution policy: non-distributing
Benchmark: Markit iBoxx EUR Sovereigns Eurozone Yield Plus Index
These two new ETFs are an additional way for investors to participate in the performance of euro-area government bonds. The iBoxx EUR Sovereigns Eurozone AAA Index tracks the performance of euro-denominated government bonds that are issued by euro-area governments and have an average rating of AAA. The Markit iBoxx EUR Sovereigns Eurozone Yield Plus Index comprises euro-denominated government bonds that are issued by the five euro-area member states with the highest bond yields.
The product offering in Deutsche Börse’s XTF segment currently contains a total of 719 exchange-listed index funds, making it the largest offering of all European stock exchanges
Source: Deutsche Börse
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