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Esposito Securities Seeds Its First ETF
July 14, 2010-- Esposito Securities is proud to be seeding its first ETF with 2 creation units totaling $2.5M of the Mars Hill Global Relative Value ETF. The NYSE Euronext announced that on Friday, July 9, 2010, the "GRV" ETF was listed on NYSE Arca and began trading as a new issue. The Consolidated Tape Association (CTA) will disseminate real time trade and quote information for the ETF to Tape B.
"Seeding GRV sets the tone for future activities of Esposito Securities. We will be more aggressively pursuing seeding opportunities," states Mark Esposito, CEO.
The foray of Esposito Securities into ETF activity speaks to the strategic direction of Esposito to provide across the board trading services for its clients. Esposito Securities, LLC is a part of the Esposito Global family, and provides global equity trading services. A growing list of clients use our services, including registered investment advisors, mutual funds, hedge funds, ETFs, closed end funds and unit investment trusts with trillions of dollars in assets.
The benchmark of Esposito is a commitment to customer service.
Contact any of our New York team at 212.202.0762 or visit our website at www.espositoglobal.com for more information.
Source: Esposito Securities, LLC
Horizons AlphaPro Launches S&P/TSX 60 Equal Weight Index ETF
July 14, 2010--AlphaPro Management Inc. ("AlphaPro"), the manager of the Horizons AlphaPro family of exchange traded funds ("ETFs"), is pleased to announce the listing of the first and only ETF in Canada to track the recently created S&P/TSX 60(TM) Equal Weight Index (the "Equal Weight Index"). The Horizons AlphaPro S&P/TSX 60 Equal Weight Index ETF (the "Equal Weight ETF") will begin trading today on the Toronto Stock Exchange (the "TSX") under the symbol HEW.
The Equal Weight ETF will seek to replicate the performance of the Equal Weight Index, net of expenses.
The Equal Weight Index and the S&P/TSX 60(TM) Index are comprised of 60 of the largest (by market capitalization) and most liquid securities listed on the TSX, selected by Standard & Poor's using its industrial classifications and guidelines for evaluating issuer capitalization, liquidity and fundamentals.
As its name implies, the Equal Weight Index assigns an equal weight to each of the constituent 60 Canadian stocks in the S&P/TSX 60(TM) Index and is rebalanced on a quarterly basis.
ETFs that use the S&P/TSX 60(TM) Index as a benchmark represent a large proportion of Canadian ETF assets. The S&P/TSX 60(TM) Index uses a market-capitalization weighting ("Cap-Weighted") methodology. A Cap-Weighted methodology assigns a weight to each constituent issuer based on its market capitalization and is not rebalanced.
As of June 21, 2010, the last rebalance date of the Equal Weight Index, the 10 largest constituents represented more than 45.4% of the weight of the S&P/TSX 60(TM) Index, whereas these same 10 stocks represented less than 17% of the weight of the Equal Weight Index. In addition, 32.9 % of the S&P/TSX 60(TM) Index was concentrated in the financial sector, while only 16.7% of the Equal Weight Index was in that sector.
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Source: AlphaPro Management
UBS AG Exchange Traded Access Security (E-TRACS) Linked to the Alerian Natural Gas Index to begin trading on NYSE Arca
July 14, 2010-- NYSE Euronext (NYX) announced that its wholly-owned subsidiary, NYSE Arca, today began trading the UBS AG Exchange Traded Access Security (E-TRACS) Linked to the performance of the Alerian Natural Gas Index due July 9, 2040. Issued by UBS AG, this exchange traded note is a senior unsecured medium-term note, which may issue a quarterly coupon during their term less the accrued fees.
The Alerian Natural Gas Index is composed of the 15 largest natural gas infrastructure-focused master limited partnerships, whose constituents generally earn the majority of their EBITDA from the transportation, storage, and processing of natural gas. It provides investors with a transparent value for midstream companies with long-term contracts and hard assets exposed to potential growth from the expansion of existing pipeline and storage capacity, as well as supply shifts associated with other large-scale U.S. shale projects.
For more information on the fund, please visit http://www.ibb.ubs.com/mc/etracs_US/
Source: NYSE Euronext
TABB Says Buy Side Use of Algorithms Will Rise to 35% in 2011, on Par with High-Touch Sales Traders for the First Time
New Research Details Low-Touch Trading Trends in the US Equity Markets Based on Interviews with 123 US-based Asset Managers and Hedge Funds
July 14, 2010 – With asset managers and hedge funds in the US accounting for nearly one third of the share volume traded in 2010, up sharply from a low of 25% in December 2008, the overall effect on the institutional equity brokerage industry is a wash: trading volume is down but not as much as the rest of the industry. Meanwhile, TABB Group, in a new research report published today, says that the use of low-touch algorithms will reach 35% in 2011, for the first time on par with high-touch sales traders.
The new report, “US Equity Trading 2010: Low-Touch Trends,” provides a capital markets industry update on low-touch trading trends in the US equity markets. Its co-authors, Cheyenne Morgan, research analyst, and Adam Sussman, director of research, analyzed data based on interviews with 123 head traders of US-based institutional equity management firms and head traders with aggregate assets under management (AuM) of $12.1 trillion and $182.1 billion, respectively.
A considerable portion of these discussions covered head traders’ opinions regarding the continued growth of low-touch trading, including trends in order allocation across high- and low-touch trading venues and selection criteria in algorithmic trading. The report also focuses on dark pools and crossing networks
According to Morgan, algorithms continue to be the stand-out winner amongst trading strategies, continuing to grow in importance and volume as traders turn to low-touch execution methodologies. “Competition for market share amongst the top algorithm providers is intense and while there is more competition then ever amongst the top five providers, the total number of participants TABB identifies is 13, all with strong positions, indicating there is a clear list of contenders in this space providing buy-side firms with more choices than ever” This, she adds, is occurring at a time that, although sales trading remains the dominant source of commission revenues, TABB believes algos will continue to gain ground.”
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Source: TABB Group
Minutes of the Federal Open Market Committee, May 9 and June 22-23, 2010
July 14, 2010--The Federal Reserve Board and the Federal Open Market Committee on Wednesday released the attached minutes of the Committee meeting held on June 22-23, 2010 and of the conference call held on May 9, 2010. A summary of economic projections made by Federal Reserve Board members and Reserve Bank presidents for the June 22-23, 2010 meeting is also included as an addendum to these minutes.
The minutes for each regularly scheduled meeting of the Committee ordinarily are made available three weeks after the day of the policy decision and subsequently are published in the Board's Annual Report. Summaries of economic projections are released on an approximately quarterly schedule. The descriptions of economic and financial conditions contained in these minutes and in the Summary of Economic Projections are based solely on the information that was available to the Committee at the time of the meeting.
The FOMC minutes can be viewed on the Board's website at http://www.federalreserve.gov/monetarypolicy/fomccalendars.htm.
view the Minutes of the Federal Open Market Committee-May 9 and June 22-23, 2010
view 2010 Monetary Policy Releases
Source:Federal Reserve Board
SEC Votes to Seek Public Comment on U.S. Proxy System
July 14, 2010--The Securities and Exchange Commission today voted unanimously to issue a concept release seeking public comment on the U.S. proxy system and asking whether rule revisions should be considered to promote greater efficiency and transparency.
The U.S. proxy system governs the way in which investors vote their shares in a public company regardless of whether they attend shareholder meetings.
“The proxy is often the principal means for shareholders and public companies to communicate with one another, and for shareholders to weigh in on issues of importance to the corporation,” said SEC Chairman Mary L. Schapiro. “To result in effective governance, the transmission of this communication between investors and public companies must be timely, accurate, unbiased, and fair.”
It has been nearly 30 years since the Commission last conducted a comprehensive review of the proxy voting infrastructure. With significant changes since then in shareholder demographics, technology, and other areas, the Commission’s review of the U.S. proxy system will examine emerging issues that either did not exist or were not considered significant three decades ago.
The SEC’s concept release focuses on the accuracy and transparency of the voting process, the manner in which shareholders and corporations communicate, and the relationship between voting power and economic interest.
view concept release
Source: SEC.gov
Pimco makes U-turn on UK bonds
July 14, 2010--Pimco, the world’s second-biggest bond fund manager, has reversed its decision to cut exposure to the UK bond markets after this year’s impressive performance of gilts.
Pimco, which took a negative view on the UK last year because of the widening budget deficit and poor public finances, has switched its stance from underweight to neutral on gilts, according to people familiar with the situation.
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Source: FT.com
New! Weeklys on DJX starting Thursday
July 14, 2010--Beginning Thursday, July 15, CBOE will add Weeklys options on The Dow Jones Industrial AverageSM (option ticker symbol: DJX). New DJX Weeklys series generally will be listed on Thursday mornings and the last trading day will be the following Thursday; they are “Friday a.m.” settled and expire on Fridays.
Weeklys are options that have a life of just one week. Typically new series are listed on Thursdays and expire on Friday the following week. However, new Weeklys series are not listed that would expire during the expiration week for standard options (the third Friday of the month). Except for the time to expiration, Weeklys have the same contract specifications as standard options.
CBOE now offers Weeklys options on*:
Indexes: SPX, DJX, OEX and XEO. (Note that new XSP Weeklys series will not be listed)
ETFs: SPY, QQQQ, IWM, GLD, GDZ, XLF, EEM.
Equities: Citigroup, Inc. (C), Bank of America Corporation (BAC), Apple Inc. (AAPL), British Petroleum (BP) Ford Motor Company (F) and Google Inc. (GOOG).
*Weeklys classes can change week to week
Source: CBOE
Direxion Shares Launches Four New Leveraged ETFs
New Funds Offer Long and Short Exposure to the Retail and Natural Gas Related Sectors
July 14, 2010---- Direxion, a pioneer in providing alternative investment strategies to sophisticated investors, is pleased to announce the launch of four new Direxion Shares Daily 2x ETFs to its existing lineup of multi-directional, leveraged funds. This brings the total number of leveraged ETFs offered by Direxion to thirty-eight.
The new ETFs are leveraged Bull and Bear funds that seek 200% of the daily performance, or 200% of the inverse of the daily performance (before fees and expenses), of the ISE-REVERE Natural Gas Index and the Russell 1000 RGS Retail Index.
These new funds, and all Direxion Shares ETFs, are intended for use only by sophisticated investors who understand the risks associated with seeking daily leveraged investment results and plan to actively monitor and manage their positions in the funds. There is no guarantee that the funds will achieve their objective.
"Direxion works to continuously deliver innovative tactical investment solutions that help sophisticated investors take advantage of market opportunities regardless of conditions," stated Dan O'Neill, Direxion Shares' President.
Many sophisticated advisors and institutional investors are using Direxion 2x and 3x ETFs to hedge positions in their current portfolios, while others are using the Funds to seek to take advantage of short-term trading opportunities available in today's markets.
The ISE-REVERE Natural Gas Index tracks companies that derive a substantial portion of their revenues from the exploration and production of natural gas. The Russell 1000 RGS Retail Index includes constituents of the Russell 1000 Index that are classified within the Retail subsector of the Russell Global Sector Scheme.
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Source: Direxion
NYSE Arca to Introduce New Collar to Safeguard Market Orders
July 14, 2010-- NYSE Arca, a unit of NYSE Euronext (NYX), has filed with the Securities and Exchange Commission to introduce a new price collar designed to safeguard the execution of market orders. The new price collar will be introduced on July 15, 2010 and is the latest in a series of steps implemented to improve market practices and structure since the "flash crash" of May 6, 2010.
"The market-order collar is an additional protection that complements those already in place and addresses a specific issue highlighted by the flash crash -- market orders that were executed at anomalous prices in electronic markets. The new collar is designed to help limit potential harm from extreme market volatility by preventing trades from occurring a specified percentage away from the last trade price," said Joseph Mecane, Executive Vice President and Co-Head of U.S. Listings and Cash Execution. "We will continue working closely with the SEC, other markets and market participants toward the goals of further strengthening the markets' safety net and rebuilding investor confidence in our national market system."
The new collar will prevent market orders to buy stock from executing or routing to another trading venue at a price above the collar. Conversely, market orders to sell will not execute or route at a price below the trading collar. The collar for issues priced $25 or less will be 10 percent above or below the last trade price; for issues priced above $25 up to and including $50, the collar will be 5 percent; and for issues above $50, the collar will be 3 percent. These limits also will help prevent erroneous trades from inadvertently triggering the individual-stock circuit breakers introduced last month, and are consistent with those in the newly implemented rules concerning the cancellation of erroneous trades.
Additional details of the new measure, including trading examples, are in the NYSE Arca rule filed with the SEC, linked here: http://apps.nyse.com/commdata/pub19b4.nsf/docs/F9706A0475E6BEAF85257760005AC153/$FILE/NYSEArca-2010-67.pdf
In just over two months since May 6, the following corrective measures have been implemented by the markets in concert with the SEC:
A pilot program of circuit breakers for individual issues was first rolled out on June 11 for stocks in the Standard & Poor's 500.
An expansion of the above pilot program to cover 344 exchange traded products plus all stocks in the Russell 1000 index is planned for later this month, pending SEC approval.
All markets have proposed amendments to existing rules concerning clearly erroneous trades, to make the cancellation of such trades -- when they occur in connection with an individual stock circuit breaker -- transparent and predictable for market participants.
NYSE Arca has revised its market order routing to further enhance its interaction with the New York Stock Exchange when a Liquidity Replenishment Point has been reached and other individual-stock safeguards imposed by primary markets.
Source: NYSE Euronext
