Americas ETP News
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Vanguard leads 2011 cash race for US ETF providers
January 10, 2012--Vanguard led the race among US exchange traded fund providers for investors’ cash for a second year in succession in 2011, pushing iShares, the world’s largest ETF provider, into the runner’s up spot, according to data from the ETF Industry Association.
Net new inflows into US listed ETFs (funds and products) topped the $100bn mark for a fifth year in succession at $117.6bn, down 1 per cent on the $118.7bn gathered in 2010.
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Source: FT.com
Appetite for new US ETF wanes
January 10, 2012--A record number of new US exchange-traded funds failed to attract substantial investor demand last year, leaving fund operators facing losses in one of the first signs that the industry’s explosive growth may have peaked.
The US ETF industry ended last year with more than $1tn in assets under management, compared with $540bn at the start of 2009. But that rapid growth has attracted scrutiny from regulators, and there are signs the market may be saturated.
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Source: FT.com
New ETFs struggle for assets
January 10, 2012-- As more and more exchange-traded funds enter the market, appetites for new baskets of stocks seem to be diminishing – at least in the United States. According to the Financial Times and XTF, an ETF research firm, 79 per cent of the 190 ETFs launched in the first six months of 2011 failed to attract enough money to make the new funds economical and sufficiently liquid (defined as more than $30-million (U.S.) in assets under management).
That’s up from 62 per cent in 2010 and less than 50 per cent in 2009.
As the article notes, ETF providers have been determined in recent years to tap into the growing popularity of ETFs – which resemble index mutual funds but trade throughout the day on stock exchanges and generally charge far lower fees.
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Source: Globe and Mail
Pimco to launch total return bond ETF March 1
January 10, 2012--Pacific Investment Management Co. has received approval from the U.S. Securities and Exchange Commission to launch its total return exchange traded fund on March 1, Pimco said on its website.
The company announced plans last year for the actively managed ETF, which will mimic the strategy of Pimco’s Total Return Fund. (Investors in Canada will be able to buy the ETF on the New York Stock Exchange in the same way they can buy U.S.-listed stocks, although it will be subject to currency fluctuations.)
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Source: Globe and Mail
ForeSight from BNY Mellon
January 10, 2012--Investors are becoming more price conscious. In response to the increased pressure to lower 401(k) costs, alternatives to traditional mutual fund investments that offer significantly lower fees are growing in popularity.
The latest offering is an all-index 401(k) plan announced Tuesday by Schwab Retirement Plan Services Inc.
The investment choices for the Schwab Index Advantage plan are limited to index funds, which are designed to track established market indexes such as the S&P 500. Index investing continues to grow in popularity because index funds do not carry the higher fees of actively managed funds
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Source: ABC News
Schwab Finds U.S. Fixed Income Exchange-Traded Funds Gain Favor While Gold Loses Luster With Advisors
Domestic Fixed Income and Equity ETFs Accounted for 87 Percent of Advisors’ Net ETF Flows in 2011
January 9, 2012--The appetite for exchange-traded funds (ETFs) among independent investment advisors continues unabated into 2012, but a new report released today by Charles Schwab suggests advisors will use them differently this year. U.S. fixed income ETFs captured 54 percent of ETF inflows in 20111, and U.S. equity ETFs saw 33 percent of flows, while funds tracking international equities and commodities - and gold in particular – lost favor.
Independent advisors held $60 billion in ETF assets at Schwab as of November 30, 2011, up five percent from the end of 2010, and ETF trade volume among advisors was up 26 percent during this same time.
“Advisors large and small see real client benefits in ETFs’ low-cost structure and flexibility, as they can make tactical adjustments to portfolios in changing markets,” said Beth Flynn, vice president of ETF platform development at Charles Schwab. “The data in our report underscore this, and the insights from our experts offer a glimpse for advisors into the ETF landscape in 2012.”
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Source: Charles Schwab
WallachBeth Adds 2 More Industry Vets to Firm's ETF Desk
Januay 9, 2012--WallachBeth Capital LLC (“WB”), the institutional brokerage/execution firm
specializing in exchange-traded funds (ETFs), equities and options, today announced its further expansion with the
addition of two more industry veterans to the firm’s ETF execution division, one of the leading ETF desks in the
Industry.
Chris Hempstead, a 20-year trading market veteran joins as Director of ETF Execution, and Dong Lee, a
12-year ETF product specialist joins as Director of Institutional Sales
Noted Michael Wallach, WB’s co-founder and CEO, “The continued growth in the ETF product arena, coupled with our firm’s unique approach to true best execution has struck more than a chord with the institutional investor community, and has required us to continuously ramp up our infrastructure with the Industry’s most talented individuals. Both Chris and Dong will add further depth to a team that’s become widely-recognized throughout the ETF landscape.”
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Source: WallachBeth
CBOE Stock Exchange Completes Acquisition Of National Stock Exchange
January 9, 2012 - CBOE Stock Exchange (CBSX) announced today that it completed the acquisition of all-electronic National Stock Exchange (NSX) on December 30. The acquisition, approved by the Securities and Exchange Commission, allows CBSX to expand its footprint in the securities exchange space by wholly owning and operating a second separate exchange.
Both exchanges will continue to operate separately under their current names and will integrate teams in Chicago and Jersey City, NJ.
"Completion of this acquisition enables us to offer customers different market structures and routing services," said CBSX CEO and President David Harris, who also has been named Chairman and CEO of NSX. "We now look forward to bringing two very talented CBSX and NSX teams together."
In September, CBSX entered into a definitive agreement to acquire the National Stock Exchange, Inc. (NSX), previously owned by a consortium of nationally known broker-dealers.
Source: CBOE
Morgan Stanley-ETF Weekly Update
January 9, 2012--Highlights
Weekly Flows: $5.0 Billion Net Inflows
ETF Assets Stand at $1.1 Trillion, up 2% YTD
No Launches Last Week
Van Eck to Change Index of Russia ETF
US-Listed ETFs: Estimated Flows by Market Segment
ETFs started 2012 on a positive note, posting net inflows of $5.0 bln last week
US Sector & Industry ETFs led the way, exhibiting net inflows of $1.6 bln last week
Only 13% of ETFs exhibited net outflows last week
ETF assets stand at $1.1 tln, up 2% YTD and up 7% from the end of 2010
13-week flows were mostly positive among asset classes; combined $46.8 bln net inflows
US Large-Cap ETFs exhibited the greatest net inflows over the past 13 weeks ($15.0 bln net inflows)
Fixed Income ETFs have consistently generated weekly net inflows (21 consecutive weeks of net inflows)
US-Listed ETFs: Estimated Largest Flows by Individual ETF
SPDR DJ Industrial Average ETF (DIA) posted net inflows of $848 mln last week, most of any ETF
7 out of 10 ETFs to generate the largest net inflows last week were US equity-based
SPDR S&P 500 ETF (SPY) exhibited net outflows of $960 mln last week, the most of any ETF; SPY typically
exhibits net outflows during the 1st quarter of every year
Notable net outflows last week in 3 short- to intermediate-term Treasury ETFs
US-Listed ETFs: Short Interest
Data Unchanged: Based on data as of 12/15/11
EFA exhibited the largest increase in USD short interest since last updated
$566 million in additional short interest
Highest level of shares short for EFA since 9/30/11
XRT’s shares short divided by shares outstanding in excess of 400%
Retail continues to be one of the most heavily shorted areas of the ETF market
Based on multiple borrowings and the ability to continuously create new shares to cover shorts, short interest
as a % of market cap can exceed 100%
US-Listed ETFs: Most Successful Recent Launches by Assets
Data estimated as of 1/6/12 based on daily change in share counts and daily NAVs.
$7.2 billion in total market cap of ETFs less than 1-year old
Over past 13 weeks, newly launched US Dividend Income ETFs generated most net inflows at $745 mln
No new listings so far in 2012; 225 new ETF listings and 26 liquidations in 2011
Newly issued dividend/income-focused ETFs have been successful over past year
8 different ETF sponsors and 2 asset classes represented in top 10 most successful launches
Top 10 account for 55% of market cap of ETFs launched over the past year
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Source: Morgan Stanley
iShares sees huge jump in inflows
January 9, 2011--New inflows into BlackRock’s iShares European exchange traded funds business exceeded $18bn last year, up around 43 per cent compared with 2010, amid a return by investors to traditional “physical” ETFs that buy the constituents of an index.
Deborah Fuhr, an independent ETF strategist, said potential regulatory changes had encouraged many ETF users to prefer physical products.
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Source: FT.com
