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ETF Weekly Update-Morgan Stanley
June 14, 2010--Weekly Flows: $3.7 Billion Net Inflows
Launches: 8 New ETFs; SEA Re-launches
iShares Gold ETF to Undergo 10-for-1 Split
Van Eck Reduces Expense Caps on 3 ETFs
US-Listed ETFs: Estimated Flows by Market Segment
In the midst of rebound in equities, ETFs had net cash inflows of $3.7 bln last week
Flows primarily driven by US Large-Cap and Fixed Income over past week.
Over 4-week period, net outflows driven primarily by SPY.
Over 13-weeks, Fixed Income & Commodities account for 45% of ETF net inflows
$35.6 bln net inflows into US-listed ETFs over past 13 weeks with almost all categories exhibiting net inflows.
US-Listed ETFs: Estimated Largest Flows by Individual ETF
For third straight week, SPDR Gold Trust (GLD) takes in most new money
GLD exhibits largest net inflows on 1-, 4-, 13- week basis.
PowerShares DB US Dollar Bullish Index Fund (UUP), despite solid performance over past 13-weeks,
experienced net outflows of almost $700 million.
request report
Source: Morgan Stanley Research
SEC, Quebec Autorité Des Marchés Financiers And Ontario Securities Commission Sign Regulatory Cooperation Arrangement
June 14, 2010--- The U.S. Securities and Exchange Commission (SEC), Quebec Autorité des marchés financiers (AMF) and Ontario Securities Commission (OSC) today announced a comprehensive arrangement to facilitate their supervision of regulated entities that operate across the U.S.-Canadian border.
SEC Chairman Mary L. Schapiro, AMF President and CEO Jean St-Gelais and OSC Chair David Wilson executed a memorandum of understanding (MOU) that provides a clear mechanism for consultation, cooperation, and exchange of information among the SEC, AMF and OSC in the context of supervision. The MOU sets forth the terms and conditions for the sharing of information about regulated entities, such as broker-dealers and investment advisers, which operate in the U.S., Quebec and Ontario.
The SEC, AMF and OSC have a long history of cooperation particularly in securities enforcement matters. This MOU would extend this cooperation beyond enforcement by setting forth a framework for consultation, cooperation and information-sharing related to the day-to-day supervision and oversight of regulated entities. The supervision of regulated entities is critical to encouraging compliance with the securities laws, which in turn helps to protect investors and the securities markets generally.
The MOU was signed in Montreal on June 10, 2010, after the close of the 35th Annual Conference of the International Organization of Securities Commissions (IOSCO). It follows on the heels of the IOSCO Task Force on Supervisory Cooperation Report, which was published on 25 May 2010 and is available at: http://www.iosco.org/library/pubdocs/pdf/IOSCOPD322.pdf
In response to the recent financial crisis, the Task Force and many other groups, including the G20, have recommended that regulators enhance the supervision of internationally-active regulated entities by working with their foreign counterparts.
view the MOUs
Source: OSC.gov.on.ca
Frank Announces House Offer to Base Text on Private Funds, Credit Rating Agencies, Thrifts and Insurance
June 14, 2010--Chairman Frank, on behalf of the House conferees, released the House offer on the titles listed below. The issues will be subject to debate when the House-Senate Conference Committee convenes tomorrow.
The issues for tomorrow’s offer:
Title 4 of base text: Private Funds
Title 9, subtitle C of base text: credit rating agencies
Title 3 of base text: OTS/OCC merger; thrift charter
Title 5 of base text: Insurance
read more
Source: House Financial Services Committee
Teucrium Trading LLC Announces “CORN,” A Single-Commodity ETF
June 14, 2010--Teucrium Trading LLC (Teucrium) announces the launch of its first Exchange Traded Fund (ETF) and the first domestic ETF offering investors and hedgers exposure exclusively to corn. The ETF is a single-commodity ETF that has been developed by Teucrium Trading LLC. The ETF, Teucrium Corn Fund, symbol “CORN” was launched on the NYSE Arca on Wednesday, June 9th.
Teucrium designs next-generation commodity investment products in the popular and highly liquid ETF format. The Teucrium Corn Fund (“CORN”) offers investors and hedgers liquidity, transparency and capacity in a single-commodity ETF product. ETFs are transparent because holdings are disclosed on the website daily and liquid because they can be traded throughout the day.
“As the first Single-Commodity Agriculture ETF, we are breaking new ground by offering access to corn as a commodity,” said Sal Gilbertie, Founder and President of Teucrium Trading LLC. “We have designed an ETF for real exposure to the grain itself. Like any ETFs we offer in the future, CORN offers our unique approach that closely tracks the price of the underlying commodity. I believe our team has the product design expertise and commodities trading experience to offer investors and hedgers a simple and efficient single-commodity ETF product.”
Teucrium Trading LLC’s management team brings decades of commodities industry trading experience. This includes running the commodities desk at a major global brokerage as an active futures and swap trader and market maker in numerous commodities, specializing in energy and grains. They also have successful Initial Public Offering experience and senior financial and operational management expertise from start-ups to Wall Street investment banks.
Source: Teucrium Trading LLC
Morningstar Reports U.S. Mutual Fund and ETF Asset Flows Through May 2010
June 11, 2010--Morningstar, Inc. a leading provider of independent investment research, today reported estimated U.S. mutual fund and exchange-traded fund asset flows through May 2010. Redemptions of nearly $15.0 billion from domestic-equity funds, the largest monthly outflow since March 2009, contributed to outflows of $13.2 billion for all long-term mutual funds in May.
The European economic woes that dominated the headlines throughout the month brought an end to 13 consecutive months of steady inflows for international-stock funds. The asset class saw outflows of nearly $6.0 billion in May. Despite the market malaise, U.S. ETFs saw inflows of $4.8 billion in May, bringing year-to-date net inflows to $24.7 billion. The ETF industry had roughly $792.6 billion in assets as of the end of May.
Additional highlights from the report on mutual funds:
While most bond categories saw positive flows in May, all but 34 of the 146 high-yield bond funds registered outflows in May. A total of $6.3 billion exited the category in May, which is the largest monthly outflow since Morningstar began keeping record in 1998. Conversely, short-term bond funds attracted $4.0 billion in new assets during the month.
Record flows into emerging-markets bond funds suggest that investor perception about the risks of emerging-markets debt has changed. Flows into emerging-markets bond funds have increased steadily since mid-2009.
Although money market funds saw outflows of $20.6 billion in May, the pace of redemptions slowed significantly.
Excluding target-date funds, approximately 80 new funds have launched in 2010. Managed by star fixed-income manager Jeffrey Gundlach, the top newcomer is DoubleLine Total Return, which has amassed total net assets of $610 million since its early April debut.
Additional highlights from the report on ETFs:
Commodities, with more than $5.6 billion in net inflows, topped all ETF asset classes in May. SPDR Gold Shares GLD, which has about $50 billion in total net assets and holds more than 1,200 tons of gold bullion, led the way.
United States Oil USO gathered assets of $751 million in May, as the daily headlines on the oil spill in the Gulf of Mexico sparked newfound interest in speculating on crude.
Taxable-bond ETFs saw inflows of $2.3 billion in May, led by iShares Barclays 1-3 year Treasury Bond SHY with $906 million in net inflows.
Domestic equity was the only asset class among ETFs to experience net redemptions in May, with outflows of $4.7 billion.
view report
Source: Morningstar
CFTC Proposes Rulemaking Regarding Co-location/Proximity Hosting Services
June 11, 2010--The Commodity Futures Trading Commission (Commission) today announced the publication in the Federal Register of a proposed rule that specifies requirements for Designated Contract Markets, Derivatives Transaction Execution Facilities and Exempt Commercial Markets that list significant price discovery contracts (collectively referred to as “exchanges”) and offer co-location and/or proximity hosting services to market participants. The proposal includes provisions relating to equal access, fees, latency transparency and third party proximity hosting service providers.
Specifically, the provision relating to equal access would require that co-location and proximity hosting services be available to all qualified market participants willing to pay for the services. The provision relating to fees would ensure that cost is not used as a means to deny access to some market participants by pricing them out of the market. The provision relating to latency transparency would ensure that the longest, shortest and average latencies for each connectivity option are readily available to the public. The provision relating to third-party providers would ensure that they can continue to provide hosting services and that exchanges could obtain information about market participants, their systems and their transactions from third-party providers sufficient to carry out self-regulatory obligations.
The Commission continues to study other issues related to high frequency trading, including evaluating the impact of high frequency trading on Commission regulated markets and firms and on price discovery and risk management functions.
Comments regarding the proposed rule should be received by the Commission within 30 days of publication in the Federal Register.
75 FR 33198-proposed rules
Source: CFTC,gov
MSCI to incorporate ESG risks into indices
June 11, 2010--Index firm MSCI, fresh from its $1.55bn (€1.28bn) acquisition of risk and corporate governance advisory firm RiskMetrics, is to create a new product including environmental, social and governance (ESG) factors (amends to clarify that it’s a new product).
Before being acquired by MSCI, RiskMetrics had been on a shopping spree itself, recently acquiring ESG research houses Innovest and KLD. The FT reported that these teams would now be merged and work on integrating ESG criteria into MSCI productss. KLD’s licensing agreement with MSCI’s rival FTSE is now under review, the FT added.
read more
Source: Responsible Investor
Claymore Re-Introduces a Global Maritime Shipping ETF
Claymore Shipping ETF Provides Investors Access to Shipping Companies
June 11, 2010--Claymore Securities Inc., announced today the launch of the Claymore Shipping ETF (SEA), on the NYSE Arca. SEA is expected to reclaim the position held by Claymore’s previous shipping ETF as the largest, most actively traded US-listed shipping ETF, by providing investors with a cost-efficient means of broadly accessing the rapidly growing global maritime shipping industry.
“We are pleased to be launching the Claymore Shipping ETF, which will provide investors with cost-efficient and broad access to the global shipping industry,” said William Belden, Managing Director, Claymore Securities, Inc. “Because our first shipping ETF was so popular with investors and advisors, the successor fund largely mirrors its structure and seeks to track the performance of the same index.”
The Fund seeks to replicate the performance, before the Fund’s fees and expenses, of the Delta Global Shipping Index (Index Ticker: DGAGSI) which was developed and is maintained by Delta Global Indices LLC, a wholly-owned subsidiary of Delta Global Advisors Inc. The Delta Global Shipping Index includes companies that derive at least 80% of their revenues from operating or leasing ships or from the transportation of goods via ship. Additionally, index constituents must have at least $250 million in market capitalization and a 30-day average daily trading volume of at least $2 million.
For more information on Claymore Shipping ETF please visit www.claymore.com/SEA.
Source: Claymore Securities
Treasury Department Announces TARP Milestone: Repayments to Taxpayers Surpass Tarp Funds Outstanding
June 11, 2010--Today, in its May monthly Troubled Asset Relief Program (TARP) report to Congress, the U.S. Department of the Treasury announced that TARP repayments to taxpayers have, for the first time, surpassed the total amount of TARP funds outstanding.
Treasury's report showed that, through the end of the May, TARP repayments had reached a total of $194 billion, which exceeded the total amount of TARP funds outstanding ($190 billion) by $4 billion.
"TARP repayments have continued to exceed expectations, substantially reducing the projected cost of this program to taxpayers," said Assistant Secretary for Financial Stability Herb Allison. "This milestone is further evidence that TARP is achieving its intended objectives: stabilizing our financial system and laying the groundwork for economic recovery."
TARP repayments officially surpassed total TARP funds outstanding in May when Treasury completed its sale of 1.5 billion shares of Citigroup – a transaction that provided gross proceeds of $6.18 billion to taxpayers.
view the May 2010 Monthly 105(a) Report on the Troubled Asset Relief Program
Source: U.S. Department of the Treasury
CFTC.gov Commitments of Traders Reports Update
June 11, 2010--The CFTC.gov Commitments of Traders Reports has been updated. The current reports for the week of June 8, 2010 are now available.
read more
Source: CFTC.gov
