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Fact Sheet: Notice of Proposed Determination on Foreign Exchange Swaps and Forwards
April 29, 2011-The Dodd-Frank Act put in place a comprehensive set of reforms to help build stronger, safer, and more efficient financial markets. The Obama Administration fought hard for and strongly supports the Dodd-Frank Act’s comprehensive reforms to the derivatives market, which will reduce risk, increase transparency, and provide accountability for market participants.
Recognizing that the unique characteristics and oversight of the FX swaps and forwards market already reflect many of Dodd-Frank’s objectives for reform – including high levels of transparency, effective risk management, and financial stability – Congress provided the Secretary of the Treasury with the authority to determine whether central clearing and exchange trading requirements should apply to foreign exchange (FX) swaps and forwards.
The FX swaps and forwards market is markedly different from other derivatives markets. Existing procedures in the FX swaps and forwards market mitigate risk and help ensure stability. Central clearing requirements will strengthen the rest of the derivatives market, but could actually jeopardize practices in the FX swaps and forwards market that help limit risk and ensure that it functions effectively. This market plays such an important role in helping businesses manage their everyday funding and investment needs throughout the world that disruptions to its operations could have serious negative economic consequences.
view Determination of Foreign Exchange Swaps and Foreign Exchange Forwards under the Commodity Exchange Act
Source: US Department of the Treasury
ETF providers feel pinch from fee wars
April 29, 2011--As exchange traded fund sponsors continue to whittle away expense ratios to generate flows and attention, the low-fee environment is playing a large hand in shaping firms’ product and distribution strategies.
Low-cost players such as Vanguard and Charles Schwab have burst into the ETF market and rapidly attracted assets. The pricing pressure has become so strong in certain segments of US equities and emerging markets that firms such as FocusShares, the ETF arm of discount brokerage Scottrade, offer products with expense ratios of 0.05 per cent. The average annual expense ratio for an index-based ETF is 0.56 per cent.
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Source: FT.com
Pension funds take shine to ETFs
April 29, 2011--As exchange traded funds continue to grow in the retail space, managers say they are also seeing steady interest from pension funds and other institutional investors.
Some of the biggest managers are leveraging their firms’ existing institutional relationships to introduce ETFs to pensions, while also educating investment consultants on what, according to managers, are the benefits of ETFs for institutional investors.
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Source: FT.com
US Treasury grants exemption for forex swaps
April 29, 2011--The US Treasury has opted to exempt foreign exchange swaps from sweeping new derivatives rules, providing a big victory for dealers and a defeat for the proponents of more far-reaching market reforms.
Last year’s Dodd-Frank regulatory overhaul gave Tim Geithner, the Treasury secretary, the power to decide that over-the-counter forex swaps and forwards did not need to be subject to the same requirements for clearing and exchange trading as other derivatives.
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Source: FT.com
CFTC Staff Provides Concepts and Questions Document Ahead of Joint CFTC-SEC Public Roundtable Discussion on Dodd-Frank Implementation
April 29, 2011--Staff of the Commodity Futures Trading Commission (CFTC) today released a document setting forth concepts that it is considering with regard to the effective dates of final rules for swaps under the Dodd-Frank Wall Street Reform and Consumer Protection Act.
The document, which is being provided to panelists participating in the May 2-3, 2011, public roundtable being hosted by the CFTC and the Securities and Exchange Commission (SEC), also presents a series of relevant questions concerning how to phase the implementation of new rules.
view Concepts and Questions, CFTC-SEC Staff Roundtable Discussion on Dodd-Frank Implementation
Source: CFTC.gov
Standard & Poor's Announces Changes In The S&P/TSX Venture Composite Index
April 28, 2011--Standard & Poor's will make the following changes in the S&P/TSX Venture Composite Index after the close of trading on Thursday, April 28, 2011:
The shareholders of Continental Minerals Corporation (TSXVN:KMK) have approved the Plan of Arrangement whereby the shares of the company will be acquired by Jinchuan Group Ltd. for $CDN2.60 cash per share.
Continental Minerals will be removed from the S&P/TSX Venture Composite Index after the close of Thursday, April 28, 2011.
The shareholders of UNX Energy Corp. (TSXVN:UNX) have accepted the Offer to Purchase from HRT Participacoes em Petroleo S.A. UNX Energy will be removed from the S&P/TSX Venture Composite Index after the close of Thursday, April 28, 2011.
Company additions to and deletions from an S&P equity index do not in any way reflect an opinion on the investment merits of the company.
Source: Standard & Poors
Statement at SEC Open Meeting: Product Definitions and Regulation of Mixed Swaps
Commissioner Kathleen L. Casey
U.S. Securities and Exchange Commission
Washington, D.C.
April 27, 2011--Thank you, Chairman Schapiro. First, I want to join you in thanking the staff, and particularly the staffs of the Divisions of Trading and Markets and Corporation Finance, for their hard work on this release. While Dodd-Frank's rulemaking burden is a challenge for the Commission generally, joint rulemakings such as this one, which has required many months of coordination and negotiation with the CFTC, are particularly challenging. Today's proposal is a testament to the diligence, expertise, and diplomatic skill of our staff, and I commend them again for their efforts.
In thinking about this rulemaking, the overriding objective should be to provide clarity and regulatory certainty to the greatest degree possible to both market participants and regulators. That means, first, that we be clear about what products are regulated as swaps or security based swaps under Dodd-Frank and what products are not. Second, that within the universe of regulated swap products, we are clear about which are swaps regulated by the CFTC and which are security based swaps regulated by the Commission. And third, as to the category of mixed swaps, which are jointly regulated by both the CFTC and the SEC, that we provide clear rules of the road as to how the agencies will regulate these products.
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Source: SEC.gov
SPDR® ETF Family Announces Impact of Receiving Settlement Payment
April 28, 2011--The SPDR® Morgan Stanley Technology ETF today announced that the fund received payment as an authorized claimant from a class action settlement related to Broadcom Corp.
The total amount payable to the fund is listed below. When the fund calculates its net asset value (“NAV”) per share on Friday, April 29, 2011, it is estimated that the fund’s NAV will be impacted by the receipt of the corresponding payment in the amount stated below based on the shares outstanding as of April 28, 2011.
| Fund | Settlement Payment |
Shares Outstanding as
of April 28, 2011 |
Per Share Amount | |||
|
SPDR® Morgan
Stanley Technology ETF |
$98,039 | 3,250,108 | $0.0302 |
State Street manages $260 billion* in SPDR ETF assets worldwide (as of March 31, 2011) and is one of the largest ETF providers in the US and globally.
Source: State Street Global Advisors
ETSpreads, LLC files with the SEC
April 28, 2011--ETFSpreads, LLC has filed an application for exemptive relief with the SEC. Applicants are seeking an order for an exemption from Sections 2(a)(32), 5(a)(1), 17(a) and 22(d) of the 1940 Act and Rule 22c-1 under the 1940 Act to permit the
Exchange Traded Spreads Trust (the “Trust”) to create and operate four (4) actively-managed series of the Trust (the “Initial Funds”) that offer exchange-traded shares (“Shares”) with limited redeemability.
view filing
Source: SEC.gov
Bernanke Says Fed to Keep Stimulus, Further Easing Unlikely
April 28, 2011--Federal Reserve Chairman Ben S. Bernanke signaled the Fed will maintain its record monetary stimulus after ending large-scale bond purchases in June, while the need to contain inflation means further easing is unlikely.
"It’s not clear that we can get substantial improvements in payrolls without some additional inflation risk,” Bernanke said at his first press conference following a meeting of the Federal Open Market Committee. “Ultimately, if -- if inflation persists or if inflation expectations begin to move, then there’s no substitute for action,” Bernanke said. “We would have to respond.”
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Source: Bloomberg
