Global ETF News Older than One Year
ETFS US Precious Metals Weekly:Investors On Edge Over Greece Despite CME Cutting Precious Metals Futures Margins
February 13, 2012--CME Group lowers the margin requirements for gold, silver and
platinum for first time since June 2011 as volatility drops. 21-day volatility has plunged from highs over 25%p.a. to currently be under 15%p.a., prompting the CME to reduce margins on precious metals by 12%, 14% and 22% for gold, silver and platinum, respectively.
Ongoing uncertainty about the global economic outlook, however, contained price action in the precious metals space last week.
Gold trades narrow range, as uncertainty over Greece debt talks balanced by central bank stimulus. Gold eased off 10-week highs last week but offsetting influences have confined gold price to a narrow range between US$1700-$1760 over the past two weeks. Although gold’s positive correlation to other cyclical has risen recently, it has lagged the price gains of other precious metals over the past month. Investors remain cautious as the ongoing deliberations over the next tranche of Greek bailout funds threaten to break down, at the same time as central banks ramp up stimulus efforts. Ongoing liquidity support from the European Central Bank and the additional $50bn QE stimulus pumped into the UK economy by the Bank of England at last week’s MPC meeting should help keep the gold price supported. Recent currency volatility has also stymied physical buying, particularly in emerging markets as financial market sentiment remains unpredictable.
visit www.etfsecurities.com for more info.
Source: Source: ETF Securities
Spillovers to Low-Income Countries: Importance of Systemic Emerging Markets
February 13, 2012--Summary:This paper documents the expanding economic linkages between low-income countries (LICs) and a narrow group of "Emerging Market leaders" that have become major players in regional and global trade and financial flows. VAR models show that these linkages have increased the share of growth volatility that can be attributed to foreign shocks in LICs.
Dynamic panel models further analyze the impact of LIC trade orientation and production structure on the sensitivity to foreign shocks. The empirical results demonstrate that the elasticity of growth to trading partners’ growth is high for LICs in Asia, Latin America and the Caribbean, and Europe and Central Asia. However, for commodity-exporting LICs in Sub-Saharan Africa and the Middle East, terms of trade shocks and demand from the emerging market leaders are the main channels of transmission of foreign shocks.
view IMF Working paper-Spillovers to Low-Income Countries: Importance of Systemic Emerging Markets
Source: IMF
Pendulum swings in favour of equities
February 10, 2012--Investment managers are moving more money into shares, in response to improving market sentiment towards Europe and the US. But opinions still differ over where, and how long, to maintain these equity holdings.
In the past week, several UK firms have announced new, or “overweight” positions in equity markets, having shifted funds out of bonds, cash and other lower-risk asset classes.
Source: FT.com
IMF Working Paper-Debt, Taxes, and Banks
February 10, 2012-Summary
Understanding the impact of the asymmetric tax treatment of debt and equity on the capital structures of financial institutions is critical to shaping and assessing responses to the problem of excessive leverage that underlay the 2009 financial crisis - but there is no empirical evidence to draw on.
Guided by a simple model of banks‘ financing decisions in the presence of both regulatory constraints and tax asymmetries, this paper explores the impact of corporate tax bias on bank leverage, the use of hybrid instruments and regulatory capital ratios for a panel of over 14,000 commercial banks in 82 countries over nine years. On average, the sensitivity of banks‘ debt choices proves very similar to that of non-financial firms, consistent with rough offsetting of two opposing effects suggested by the theory. As the model predicts, somewhat counter-intuitively, the impact of tax on hybrids is generally weak or insignificant. Responsiveness to taxation varies significantly across banks, however: those holding smaller equity buffers, and larger banks, are noticeably less sensitive to tax.
view IMF Working paper-Debt, Taxes, and Banks
Source: IMF
Global ETF Inflows Enjoy Record January
February 10, 2012--The global exchange-traded fund market saw its best January on record as investors put their money back into the ETF market in a bid to take advantage of the so-called 'January effect', analysts said.
Data from fund manager Blackrock showed that January ETF inflows surged to a new record reaching $34.1 billion, up 116% from $15.8 billion in December and a rise of 144% from January 2011. The Blackrock data covers both retail and institutional inflows.
Gordon Rose, ETF analyst at Morningstar, said: "The so-called 'January effect' describes the phenomenon when the first month of the year usually has better returns and this could have driven some money back into the market."
Source: Wall Street Journal
BlackRock New Report New Report: ETP Landscape Industry Highlights, January 2012
February 10, 2012--According to the latest 'ETP Landscape' report from the BlackRock Investment Institute, January global net asset flows into fixed income Exchange Traded Products (ETPs) set a new monthly record, attracting $9.1 billion in net new assets.
This helped propel the ETP industry to its best January ever with $34.1 billion in net new assets and a total of $1.651 trillion in Assets Under Management (AUM).
Looking to the broader ETP industry, BlackRock's January ETP Landscape report also found:
ETP industry flows were up 116% versus December 2011 and up 144% versus January 2011, which was previously the best January on record. ETP AUM as of January 2012 is up 8.3% from 2011 year-end AUM.
Equity ETP flows rose to $22.6 billion, a level not seen since October 2011.
Emerging markets equity ETPs captured $6.6 billion in net new assets in January, reversing the trend from the latter half of 2011 when four of the last six months had experienced net redemptions.
visit https://www.blackrockinternational.com for more info
Source: BlackRock
Thomson Reuters Global Equities Monthly Market Share Data Reports-January 2011
February 10, 2012--Trading is fragmenting between exchanges and competing venues. But by how much and which venues? Find out in the summarised monthly reports.
Source: Thomson Reuters
NYSE Euronext makes growth plans now merger axed
February 10, 2012--NYSE Euronext (NYX.N) outlined bold plans on Friday to grow its business through investment in clearing and technology services after regulators nixed the sale of the U.S. exchange to Deutsche Boerse.
Duncan Niederauer, the chief executive of NYSE, also said mergers and acquisitions were not out of the question after a $7.4 billion takeover by the German exchange was scuppered last week, adding he was "very interested" in European clearing house LCH.Clearnet.
Source: Reuters
EU's Barnier expresses concern about Volcker rule
Barnier questions why rule only exempts U.S. govt debt
Other countries have raised similar concerns
Volcker says these concerns are overblown
February 9, 2012--Michel Barnier, the European commissioner in charge of financial regulation, wrote U.S. regulators earlier this week raising concerns about the impact that a ban on most proprietary trading by banks could have on financial markets outside the United States.
Barnier said that a proposed U.S. rule implementing the ban applies too broadly to foreign banks and markets and should instead focus only on trading activities that occur in the United States.
Source: Reuters
ETFS Research Update - Gold: New Year, New Record?
February 9, 2012--The gold spot price saw its 11th consecutive annual increase in 2011, its longest unbroken rise since its post-Bretton Woods free-float in the early 1970s.
The gold price also set a record by rising above US$1,920/oz last year. Despite the strong performance, the gold spot price ended 2011 below US$1600/oz as a result of exceptionally volatile trade, with prices dropping through their 200 day moving average trend line for the first time since the 2008 credit crisis. Gold futures net long speculative positioning hit its lowest level in over 2 years at the end of 2011. With gold having seen a more than 10% decline since its highs last year, some investors are questioning whether the best is now behind us. In this note we examine the key drivers of the gold price, recent events and likely scenarios in 2012.
Recent Gold Price Trends
Futures net long positioning near two year low
Gold price back up above its 200 day moving average
Central bank buying highest since 1970s
visit www.etfsecurities.com for more info.
Source: ETF Securities