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ETF Exchange (ETFX) Reaches USD275m Assets Under Management As Resource-Equity Related ETFs Show Stellar Performance This Year
ETFX Funds now have over $275 million AUM, up 84% in the past two months.
Resource-equity related ETFs show stellar performance this year, with ETFX Russell Global Coal Mining Fund up 109% YTD.
ETFX equity ETF platform has seen strong trading growth, with turnover now reaching $100m per week.
Third generation ETFs pioneered by ETF Securities.
October 19, 2009--ETF Securities Ltd (ETFS), the global pioneers in Exchange Traded Commodities (ETCs) and independent provider of Exchange Traded Funds (ETFs), is pleased to announce that ETF Exchange, its third generation ETF platform has now reached over $275m in assets under management.
The ETFX equity ETF platform has seen strong trading volume growth since the introduction of thematic ETFs in the fourth quarter of 2008, and 2x short and 2x leveraged equity ETFs at the end of Q2 2009, with weekly turnover in early October up four-fold since June. Recent strong turnover has been associated with swings in market sentiment since the start of the October quarter, with a growing contribution from leveraged and short ETFs recently pushing trading volumes over $100 million per week in the opening weeks of Q4.
Commodity-related ETFs have all increased sharply since the start of 2009, with average growth of 42% YTD in the week ended October 9 (21 percentage points ahead of the DJ-STOXX 50 Index). Gains have been led by a 109% increase in the ETFX Russell Global Coal Mining Fund (COAL), an 85% rise in ETFX Dow Jones 600 Basic Resources Fund (BRES) and a 60% increase in ETFX Russell Global Steel Large Cap Fund (STLL) as high beta commodities have prospered in the context of a rebound in cyclical activity indicators. Basic resources has been the strongest performing STOXX 600 sector so far in 2009, outperforming all other sectors by 50 percentage points on average YTD.
The vision for third generation ETFs was pioneered by ETF Securities. The idea was inspired by investor demands for increased levels of transparency, liquidity and counterparty risk management. ETF Securities identified that the current ETF issuance model by single financial institutions could be strengthened by diversifying index replication across a consortium of the strongest financial players and concentrating liquidity within a single platform. Under the current ETF issuance model, if the sponsoring / issuing financial institution fails, it is highly likely that their respective ETFs would be greatly disrupted and potentially liquidated.
Commenting on ETF Exchange reaching $275m in AUM, Mark Weeks, CEO of ETF Exchange, said: "The ETF Exchange has seen rapid growth in terms of product breadth, trading liquidity, and returns since its inception in the December quarter of 2008. With the participation of a world-class network of banks the platform will offer investors a unique opportunity to trade an innovative range of ETFs with an unparalleled level of service, setting a new benchmark in global ETF trading."
Russia ready to abandon dollar in oil, gas trade with China
October 19, 2009--- Russia is ready to consider using the Russian and Chinese national currencies instead of the dollar in bilateral oil and gas dealings, Prime Minister Vladimir Putin said on Wednesday.
The premier, currently on a visit to Beijing, said a final decision on the issue can only be made after a thorough expert analysis.
"Yesterday, energy companies, in particular Gazprom, raised the question of using the national currency. We are ready to examine the possibility of selling energy resources for rubles, but our Chinese partners need rubles for that. We are also ready to sell for yuans," Putin said.
He stressed that "there should be a balance here."
On Tuesday, Russia and China agreed terms for Russian gas deliveries at a level of up to 70 billion cubic meters a year. China also imports oil from Russia.
The Russian prime minister said the issue would be addressed among others at a meeting of Shanghai Cooperation Organization (SCO) finance ministers, who are to convene before the end of the year in Kazakhstan.
Britain's Independent newspaper reported last Tuesday that Russian officials had held "secret meetings" with Arab states, China and France on ending the use of the U.S. dollar in international oil trade.
The countries are reportedly seeking to switch from the dollar to a basket of currencies including the euro, Japanese yen, Chinese yuan, gold, and a new unified currency of leading Arab oil producing countries.
The Independent said the meetings have been confirmed by Chinese and Arab banking sources.
Treasury Releases Semi-Annual Report to Congress
October 15, 2009--The U.S. Department of the Treasury today released the Semi-Annual Report to Congress on International Economic and Exchange Rate Policies, as required under Sections 3004 and 3005 of the Omnibus Trade and Competitiveness Act of 1988. The report covers the period from January 2009 through June 2009, but where available and appropriate, information through early October 2009 is included.
The report describes U.S. economic developments as well as international economic, financial, and exchange rate developments during the first half of 2009. In particular, it focuses on the policy actions that major U.S. trading partners – representing more than 80 percent of U.S. international trade – have taken to lay the foundation for economic recovery.
During the period under consideration, virtually every country and economic area described in the report put in place additional monetary and fiscal measures to bolster demand. These forceful actions worked, and the report shows that financial conditions in the United States and around the world have improved dramatically and signs of an economic recovery have begun to emerge. Global current account imbalances have fallen sharply during the crisis from a peak of 5.9 percent of world GDP to an IMF-estimated 3.6 percent in 2009. The U.S. current account deficit has fallen from a peak of 6.5 percent of GDP in the fourth quarter of 2005 to 2.9 percent of GDP in the second quarter of 2009.
As noted in the report, Treasury has concluded that no major trading partner of the United States met the standards identified in Section 3004 of the Act during the most recent reporting period.
View the Report to Congress on International Economic and Exchange Rate Policies
KLD Research & Analytics, Inc. and FTSE complete rebranding of KLD’s family of indexes as FTSE
October 15, 2009 - KLD Research & Analytics, Inc. and FTSE recently completed the rebranding of KLD’s family of indexes as FTSE KLD Indexes. The rebranding of the indexes marks the implementation of the strategic partnership the companies announced in October 2008.
Each month, in addition to reporting index returns for the previous month, FTSE and KLD will feature an index, providing a closer look at the strategy and constituents.
Component Changes Made To Dow Jones Islamic Market And Dow Jones Health Care Titans 30 Indexes
October 14, 2009-Dow Jones Indexes, a leading global index provider, today announced that Wyeth (United States, Health Care, WYE) will be removed from the Dow Jones Islamic Market Titans 100, its sub-index Dow Jones Islamic Market U.S. Titans 50 and Dow Jones Health Care Titans 30 indexes.
In the Dow Jones Islamic Market Titans 100 Index and sub-index Dow Jones Islamic Market U.S. Titans 50 Index, Wyeth (United States, Health Care, WYE) will be replaced by Dell Inc. (United States, Technology, DELL).
In the Dow Jones Health Care Titans 30 Index, Wyeth (United States, Health Care, WYE) will be replaced by Express Scripts Inc. (United States, Health Care, ESRX).
Wyeth is being removed due to its acquisition by Pfizer Inc. (United States, Health Care, PFE). All changes will be effective before the open of trading on Friday October 16, 2009.
Further information on the Dow Jones Islamic Market Titans 100, Dow Jones Islamic Market U.S. Titans 50 and Dow Jones Health Care Titans 30 indexes can be found at http://www.djindexes.com.
NASDAQ OMX Announces New Listing Market
BX Listing Platform to Provide Quality Regulation and Market Structure
October 14, 2009--The NASDAQ OMX Group, Inc.
(Nasdaq:NDAQ) announced today that it will establish a new listing
market called BX, pending SEC approval, for companies that do not
presently qualify for an exchange listing.
BX will be a modern venue for companies that aspire to list on, or
return to, The NASDAQ Stock Market. While BX will have basic
quantitative listing standards, the exchange will require companies to
comply with many of the qualitative requirements for listing on NASDAQ
and other securities exchanges. In addition, transactions on this
platform will be subject to a high level of real-time and post-trade
market surveillance.
"With BX we are filling a necessary need for a well-regulated listing venue for companies that otherwise would transfer to, or remain on an unregulated or lightly regulated platform," said Bob McCooey, Senior Vice President of NASDAQ OMX. "This platform will provide significant benefits and protections to companies and their shareholders alike."
Companies who qualify for BX will need to meet significant qualitative listing requirements including having at least three independent directors, a fully independent audit committee and an independent process for oversight of executive compensation decisions.
It is expected that candidates for BX are presently trading on one of the over-the-counter venues, either the OTCBB or the "Pink Sheets," or are listed on NASDAQ or another exchange and subject to being delisted.
NASDAQ OMX is using its listing license from the acquisition of The
Boston Stock Exchange in September 2008 to launch the BX market.
Currently, NASDAQ OMX operates a successful trading platform called
NASDAQ OMX BX that is also derived from its strategic acquisition of
The Boston Stock Exchange.
RiskMetrics primed to buy KLD
October 13, 2009-RiskMetrics Group, the New York-listed US risk management and corporate governance group is readying itself to make its second major acquisition this year in the ESG (environmental, social and governance) research space by buying Boston-based KLD Research & Analytics. Final discussions between the two companies are understood to be taking place and an announcement on a deal is expected shortly.
Spokespersons for both RiskMetrics and KLD declined to comment. However, neither firm would deny that a deal was on the table. Responsible Investor.com has learnt that negotiations have reached a late stage and are likely to be formalised.
A report by corporate governance newsletter, Global Proxy Watch, predicted that a deal could be announced within the next two weeks, if not sooner. KLD, which celebrated 20 years of business in 2008, is one of the oldest global research houses in the environmental, social and governance area.
Hedge funds misrepresent facts, says research
October 13, 2009--One in five hedge fund managers misrepresents their fund or its performance to investors during formal due diligence investigations, research from New York University’s Stern School of Business suggests.
The research is likely to be a further blow to the reputation of a battered industry, which has faced increasing demands for transparency from investors in the wake of the credit crisis.
ETF Landscape Industry Preview - End of Q3 2009
October 13, 2009--Highlights:
Global ETF and ETP Industry 2009:
• Global Exchange Traded Products "ETP" AUM breaks through US$1 trillion - all time high.
• Global ETF assets have hit an all time high of US$933 Bn at the end of Q3 2009 - 4.8% above the previous all time high of US$891 Bn set in August 2009.
• At the end of Q3 2009 the global ETF industry had 1,819 ETFs with 3,247 listings, assets of $933.49 Bn, from 96 providers on 40 exchanges around the world.
• YTD assets have risen by 31.3% which is more than the 22.5% rise in the MSCI World index in US dollar terms.
• YTD the number of ETFs increased by 14.3% with 295 new ETFs launched, while 72 ETFs were closed.
• In Q2 the number of ETFs listed in Europe surpassed the US with 751 ETFs listed in Europe, compared to 710 in the US.
• There are currently plans to launch 811 new ETFs.
• YTD the number of exchanges with official listings decreased by three to 40.
• YTD the average daily trading volume in US dollars decreased by 21.8% to US$63.0 Bn.
• Standard & Poors (S&P) ranks first in terms of ETF AUM tied to their benchmarks with assets of US$220.83 Bn and 227 ETFs, while MSCI ranks second with US$214.80 Bn and 262 ETFs, followed by Barclays Capital in third with US$77.64 Bn and 62 ETFs.
• Globally, iShares is the largest ETF provider in terms of both number of products, 403 ETFs, and assets of US$451.87 Bn, reflecting 48.4% market share; State Street Global Advisors is second with 106 products and US$138.32 Bn, 14.8% market share; followed by Vanguard with 40 products and assets of US$77.15 Bn and 8.3% market share at the end of Q3 2009.
• Globally, net sales of mutual funds (excluding ETFs) were US$97.5 Bn, while net sales of ETFs were US$65.7 Bn during the first seven months of 2009 according to Strategic Insight.
• Additionally, there were 568 other Exchange Traded Products (ETPs) with assets of US$105.87 Bn from 39 providers on 19 exchanges.
• Combined, there were 2,387 products with 4,083 listings, assets of US$1,039.35 Bn from 122 providers on 43 exchanges around the world.
• FINRA, the Financial Industry Regulatory Authority which regulates all securities firms doing business in the US, issued a regulatory notice in June 2009 to provide guidance on leveraged and inverse ETFs. The notice states that "...inverse and leveraged ETFs that are reset daily typically are unsuitable for retail investors who plan to hold them for longer than one trading session, particularly in volatile markets..."
• The Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) issued an Investor Alert on Tuesday 18 August 2009 entitled :Leveraged and Inverse ETFs: Specialized Products with Extra Risks for Buy-and-Hold Investors. The following is taken from the Alert: The SEC staff and FINRA are issuing this Alert because we believe individual investors may be confused about the performance objectives of leveraged and inverse exchange-traded funds (ETFs). Leveraged and inverse ETFs typically are designed to achieve their stated performance objectives on a daily basis. Some investors might invest in these ETFs with the expectation that the ETFs may meet their stated daily performance objectives over the long term as well. Investors should be aware that performance of these ETFs over a period longer than one day can differ significantly from their stated daily performance objectives.
• U.S. Commodity Futures Trading Commission (CFTC) held hearings on Energy Position Limits and Hedge Exemptions on July 28, July 29 and August 5, on whether federal position limits should be set on the energy markets. The hearings provided critical input from a wide range of industry participants and academics to the Commissions efforts to examine different approaches to regulate energy markets. The Commodity Exchange Act states that the Commission shall impose limits on trading and positions as necessary to eliminate, diminish or prevent the undue burdens on interstate commerce that may result from excessive speculation. The CFTC's hearings examined the role of position limits in energy markets in fulfilling the CFTC's mission to ensure the fair, open and efficient functioning of futures markets. Goldman Sachs, JPMorgan Chase and other leading banks are exempt from most commodity-trading limits in order to manage risks as they serve as market makers. The Commodity Futures Trading Commission is looking into whether those exemptions should stand, as it considers blanket limits on a variety of commodity markets. A number of ETPs/ ETFs providing exposure to commodities have recently issued notices that they have suspended their creation process.
European ETF and ETP Industry 2009:
• European ETF assets have hit an all time high of US$204 Bn at the end of Q3 2009 which is 6.3% above the previous all time high of US$192 Bn set in August 2009 and 27.8% above the high of US$160 Bn recorded in July 2008.
• At the end of Q3 2009 the European ETF industry had 783 ETFs with 1,946 listings, assets of $204.22 Bn, from 32 providers on 18 exchanges.
• 11 April 2009 marked the ninth anniversary of ETFs in Europe.
• YTD assets have risen by 43.2%, which is greater than the 27.4% rise in the MSCI Europe index in US dollar terms.
• YTD the number of ETFs increased by 23.9% with 174 new ETFs launched.
• YTD the number of exchanges with official listings decreased by three to 18.
• YTD the average daily trading volume in US dollars has increased by 18.8% to US$2.7 Bn. Most ETF trades are not required to be reported in Europe as ETFs are not covered by the European Union directive on markets in financial instruments (MiFID).
• iShares is the largest ETF provider in terms of both number of products, 167 ETFs, and assets of US$80.03 Bn, reflecting 39.2% market share; Lyxor Asset Management is second with 100 products and US$42.06 Bn, 20.6% market share; followed by db x-trackers with 113 ETFs and assets of US$33.71 Bn and 16.5% market share at the end of Q3 2009.
• In Europe net sales of mutual funds (excluding ETFs) were US$122.2 Bn while net sales of ETFs domiciled in Europe were US$19.2 Bn during the first seven months of 2009 according to Lipper FMI.
• Additionally, there were 148 other Exchange Traded Products (ETPs) with assets of US$16.35 Bn from four providers on six exchanges.
• Combined, there were 931 products with assets of US$220.57 Bn from 34 providers on 18 exchanges in Europe.
US ETF and ETP Industry 2009:
• US ETF assets have hit an all time high of US$631 Bn at the end of Q3 2009 which tops the previous all time high of US$607 Bn set in August 2009.
• At the end of Q3 2009 the US ETF industry had 721 ETFs, assets of $631.35 Bn, from 24 providers on three exchanges.
• 29 January 2009 marked the 16th anniversary of ETFs in the US.
• YTD assets have risen by 27.0%, which is more than the 17.7% rise in the MSCI US index in US dollar terms.
• YTD the number of ETFs increased by 3.3% with 65 new ETFs launched, while 42 ETFs were delisted.
• YTD the average daily trading volume in US dollars has decreased by 24.9% to US$57.8 Bn.
• iShares is the largest ETF provider in terms of both number of products, 182 ETFs, and assets of US$337.25 Bn, reflecting 53.4% market share; State Street Global Advisors is second with 87 products and US$127.34 Bn, a 20.2% market share; followed by Vanguard with 39 products, assets of US$77.10 Bn and 12.2% market share at the end of Q3 2009.
• In the US, net sales of mutual funds (excluding ETFs) were minus US$50.8 Bn, while net sales of ETFs domiciled in the US were positive US$47.4 Bn in the first seven months of 2009 according to Strategic Insight.
• Additionally, there were 137 other Exchange Traded Products (ETPs) with assets of US$75.35 Bn from 18 providers on one exchange.
• Combined, there were 858 products with assets of US$706.70 Bn from 38 providers on three exchanges in the US.
Visit Barclays Global for more information.
Switzerland replaces United States at top of competitiveness rankings
October 8, 2009-– Switzerland tops the overall ranking in The Global Competitiveness Report 2009-2010, released today by the World Economic Forum ahead of its Annual Meeting of the New Champions 2009 in Dalian. The United States falls one place to second position, with weakening in its financial markets and macroeconomic stability.
Singapore, Sweden and Denmark round out the top five. European economies continue to prevail in the top 10 with Finland, Germany and the Netherlands following suit. The United Kingdom, while remaining very competitive, has continued its fall from last year, moving down one more place this year to 13th, mainly attributable to continuing weakening of its financial markets. The People’s Republic of China continues to lead the way among large developing economies, improving by one place this year, solidifying its position among the top 30. Among the three other large BRIC economies, Brazil and India also improve, while Russia falls by 12 places. Several Asian economies perform strongly with Japan, Hong Kong SAR, Republic of Korea and Taiwan, China also in the top 20. In Latin America, Chile is the highest ranked country, followed by Costa Rica and Brazil.
A number of countries in the Middle East and North Africa region are in the upper half of the rankings, led by Qatar, United Arab Emirates, Israel, Saudi Arabia, Bahrain, Kuwait and Tunisia, with particular improvements noted in the Gulf States, which continue their upward trend of recent years. In sub-Saharan Africa, South Africa, Mauritius and Botswana feature in the top half of the rankings, with a number of other countries from the region measurably improving their competitiveness
The strong interdependence among the world’s economies makes this a truly global economic crisis in every sense. Policy-makers are presently struggling with ways of managing these new economic challenges, while preparing their economies to perform well in a future economic landscape characterized by growing uncertainty. In a difficult global economic environment, it is more important than ever for countries to put into place strong fundamentals underpinning economic growth and development,” said Klaus Schwab, Founder and Executive Chairman of the World Economic Forum.
Xavier Sala-i-Martin, Professor of Economics, Columbia University, USA, and co-author of the Report added, “Amid the present crisis, it is critical that policy-makers not lose sight of long-term competitiveness fundamentals amid short-term urgencies. Competitive economies are those that have in place factors driving the productivity enhancements on which their present and future prosperity is built. A competitiveness-supporting economic environment can help national economies to weather business cycle downturns and ensure that the mechanisms enabling solid economic performance going into the future are in place.”
The rankings are calculated from both publicly available data and the Executive Opinion Survey, a comprehensive annual survey conducted by the World Economic Forum together with its network of Partner Institutes (leading research institutes and business organizations) in the countries covered by the Report. This year, over 13,000 business leaders were polled in 133 economies. The survey is designed to capture a broad range of factors affecting an economy’s business climate. The Report also includes comprehensive listings of the main strengths and weaknesses of countries, making it possible to identify key priorities for policy reform.
The Global Competitiveness Report’s competitiveness ranking is based on the Global Competitiveness Index (GCI), developed for the World Economic Forum by Sala-i-Martin and introduced in 2004. The GCI is based on 12 pillars of competitiveness, providing a comprehensive picture of the competitiveness landscape in countries around the world at all stages of development. The pillars include Institutions, Infrastructure, Macroeconomic Stability, Health and Primary Education, Higher Education and Training, Goods Market Efficiency, Labour Market Efficiency, Financial Market Sophistication, Technological Readiness, Market Size, Business Sophistication, and Innovation.
The Report contains a detailed profile for each of the 133 economies featured in the study, providing a comprehensive summary of the overall position in the rankings as well as the most prominent competitive advantages and disadvantages of each country/economy based on the analysis used in computing the rankings. Also included is an extensive section of data tables with global rankings for over 110 indicators.
This year’s Report also includes a number of discussions of selected countries and regions including the United States, the large emerging BRIC economies and the 12 recent accession members of the European Union, providing an in-depth analysis of the issues affecting national competitiveness.
View The Global Competitiveness Report 2009-2010
View Country Highlights from the Global Competitiveness Report 2009-2010
