Global ETF News Older than One Year
FIA Issues Order Handling Recommendations for Executing Brokers
March 14, 2012—The Futures Industry Association today issued order handling risk management recommendations for executing brokers.
The report documents both current practice and emerging technologies in order to respond to regulatory concerns about algorithmic trading. The recommendations were developed by experts from executing firms and represent the latest in a series of recommendations developed by FIA members for trading firms, brokers and exchanges.
"The executing broker has an important role to play in monitoring and controlling market access," said FIA President John Damgard. "The recommendations are designed to clearly differentiate the role of the execution-only broker and set an industry standard for handling orders generated by automated execution tools."
view report-Order Handling Risk Management Recommendations for Executing Brokers
Source: FIA
SGX links global liquidity pools to Asian economies, enables access to international markets
March 14, 2012--Singapore Exchange (SGX) today brings Asian markets closer to global investors with the launch of hubs in Chicago and London.
The hubs are the first by an Asian exchange and will provide customers with convenient and cost-effective local connections to SGX markets.
SGX expects to begin operating the hubs once pre-trade risk controls at the exchange level in the derivatives market are made available to participants in April. The pre-trade risk controls are in line with the Futures Industry Association’s recommendation for exchange-hosted risk controls.
By connecting to SGX’s hubs, global investors can access the world’s biggest offshore market for Asian equity futures. These include the China A50 futures, the only offshore futures for China’s domestic A-share market.
Source: SGX
Mirae BRICS Weekly-Weakness afflicts markets after strong start to the year
March 14, 2012--China
The government's GDP growth target lowered for the first time in 8 years.
The GDP growth target of 7.5% set by the National People's Congress has disappointed the market as it is the first time in 8 years that the Chinese government has set the target below 8%.
However, a lower target also provides more room for economic transformation. Expansionary fiscal policy is being seen, with budget deficit at around 2.4% of GDP after adjustment to widely accepted fiscal accounting methodology.
India
Markets fall as election dashes reform hopes.
The Indian market ended lower last week. The five state poll results was not what the market was looking for – the regional Samajwadi Party (SP) has won a majority in the Uttar Pradesh (UP) election, while the BJP, the primary opposition party, won in three out of four other states. The market reacted negatively to the result as the Congress’s support on reforms is now a question.
Brazil
Central bank cuts surprises market with 75-basis point rate cut.
The BCB cut the Selic rate by 75 bps during its March’s Copom Meeting to 9.75%. This decision was not expected by the market, which anticipated another 50-basis point cut.
Russia
Rising oil prices and easing political risk benefit Russia.
Emerging markets outperformed developed markets as China eased monetary policy and a spike in the oil price sent Russia higher. With the exception of Thailand and Egypt, Russia was the best performing emerging market.
Source: Mirae Asset Securities
IOSCO consults on exchange traded funds regulation
March 14, 2012--The Technical Committee of the International Organization of Securities Commissions (IOSCO) has published a consultation report, Principles for the Regulation of Exchange Traded Funds, which examines the key regulatory issues regarding ETFs.
It also proposes 15 principles against which both the industry and regulators can assess the quality of regulation and industry practices relating to ETFs regarding investor protection, sound functioning of markets and financial stability.
Interest in ETFs has increased worldwide as evidenced by the significant amount of money invested in these types of products. This dynamic growth has drawn the attention of regulators who are concerned about the potential impact of ETFs on investors and the marketplace.
To address these concerns, the Consultation Report proposes 15 principles that reflect a level of common approach and are a practical guide for regulators and industry practitioners. The proposed principles address ETFs that are organised as Collective Investment Schemes (CIS) and are not meant to encompass other Exchange-Traded Products (ETPs) that are not organised as CISs.
view the Principles for the Regulation of Exchange Traded Funds Consultation Report
Source: IOSCO
Greg Smith-Why I Am Leaving Goldman Sachs
March 14, 2012--TODAY is my last day at Goldman Sachs. After almost 12 years at the firm --first as a summer intern while at Stanford, then in New York for 10 years, and now in London — I believe I have worked here long enough to understand the trajectory of its culture, its people and its identity. And I can honestly say that the environment now is as toxic and destructive as I have ever seen it.
To put the problem in the simplest terms, the interests of the client continue to be sidelined in the way the firm operates and thinks about making money. Goldman Sachs is one of the world’s largest and most important investment banks and it is too integral to global finance to continue to act this way. The firm has veered so far from the place I joined right out of college that I can no longer in good conscience say that I identify with what it stands for.
It might sound surprising to a skeptical public, but culture was always a vital part of Goldman Sachs’s success. It revolved around teamwork, integrity, a spirit of humility, and always doing right by our clients. The culture was the secret sauce that made this place great and allowed us to earn our clients’ trust for 143 years. It wasn’t just about making money; this alone will not sustain a firm for so long. It had something to do with pride and belief in the organization. I am sad to say that I look around today and see virtually no trace of the culture that made me love working for this firm for many years. I no longer have the pride, or the belief.
Source: New York Times
G20 GDP for the fourth quarter of 2011-G20 GDP growth slows to +0.7% in the fourth quarter of 2011
March 14, 2012--Quarterly GDP growth in the G20 slowed to +0.7% in the fourth quarter of 2011, compared with +0.9% in the third quarter, according to provisional results. In 2011 as a whole, G20 GDP rose by 2.8%, a marked deceleration compared with the +5.0% growth recorded in 2010.
The G20 GDP aggregate masks diverging patterns among the world’s largest economies. In the United States, GDP growth increased to +0.7% in the fourth quarter of 2011, compared with +0.5% in the third quarter. In India and Indonesia growth increased strongly, but slowed in China to +2.0%, compared with +2.3% in the third quarter. In Japan, economic growth decreased to -0.2%, following the strong rebound (+1.7%) in the third quarter. GDP fell by 0.3% in both the EU271 and the euro area1 in the fourth quarter of 2011, the first fall since the second quarter of 2009.
Today’s release of the G20 GDP aggregate marks the first release of a G20 aggregate in the context of the implementation of the Data Gaps Initiative - a set of 20 recommendations on the further enhancement of statistics as agreed by the G20 Finance Ministers and Central Bank Governors. The process is coordinated by the Inter Agency Group on Economic and Financial Statistics2: International Monetary Fund, Bank for International Settlements, European Central Bank, Eurostat, OECD, United Nations and the World Bank. The dissemination of this G20 aggregate provides a timely measure of economic growth for the G20.
Source: Eurostat
S&P Indices Taps SGX Futures Prices for New S&P CNX Nifty Futures Real-time Index
March 13, 2012--S&P Indices today launched the S&P CNX Nifty Futures Real-time Index, a measure of the returns on offshore exposure to the Indian equity market based on Singapore Exchange (SGX)-listed S&P CNX Nifty Index futures prices.
The new S&P Nifty Futures Real-time Index tracks the performance of a portfolio holding a single SGX Nifty Futures reinvested on a monthly basis. The Index series is based on the front month Nifty Futures contract traded on SGX and reinvestment occurs over a three business day period preceding expiration.
The SGX Nifty Futures is based on the S&P CNX Nifty Index, the headline index of the National Stock Exchange of India which is owned and managed by India Index Services & Products Limited. A diversified 50-stock index comprising large and highly liquid securities, the Nifty Index covers 25 sectors of the Indian economy.
Source: S&P Indices
SGX and Eurex team up to enhance market access
March 13, 2012--Singapore Exchange (SGX) and Eurex today announced a partnership to deliver convenient market access and cost efficiencies to members of both exchanges.
Both companies plan to link their co-location data centers to provide market participants easy connectivity to each other’s markets in Singapore and Frankfurt/Main respectively.
As part of this partnership, Eurex will be moving its existing access point in Singapore into the SGX co-location data center. In return, Eurex will act as a network service provider to SGX’s customers in Europe. This initiative is expected to be implemented mid-2012.
When the link becomes operational, customers of each exchange can more easily and cost effectively access both markets by connecting their trade-execution systems to either the SGX or Eurex co-location data centers. Trade matching will still be executed at the respective home exchanges.
Source: Eurex
A primer on rare earth minerals
March 13, 2012--Rare earth minerals, at the heart of a major trade dispute between China and the United States, the European Union and Japan, are coveted natural resources used in high-tech items ranging from iPhones to missiles.
These elements are, surprisingly, not that rare, but unlike more common minerals are found in low concentrations and are more difficult to mine and separate.
Techniques of ion exchange and solvent extraction have led to important advances in purifying rare earth elements since the end of World War II, even as increased use of electronics has increased the demand.
Source: EUbusiness
US seeks WTO action on China's rare earth controls
March 13, 2012-- The United States on Tuesday joined the EU and Japan in a complaint at the World Trade Organization against Chinese controls on exports of rare earths, the chief US trade negotiator said.
"China continues to make its export restraints more restrictive, resulting in massive distortions and harmful disruptions in supply chains for these materials throughout the global marketplace," said the US Trade Representative Ron Kirk.
The complaint argues that China places restrictions on the export of rare earths -- 17 elements critical to the making of high-tech products from iPods to missiles -- that are illegal under global trade rules.
Source: EUbusiness
