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Most Overbought ETFs are Bond Funds
July 23, 2020--Despite the strength and speed of the stock market's recovery from the March lows, most overbought ETFs are found among bond funds--and to a lesser extent commodities--rather than among equities.
There are 59 fixed income ETFs with assets under management (AUM) totalling $387 billion that have a Relative Strength Indicator ("RSI") over 70, the typical definition of "overbought," across various categories, including TIPS, Munis, Corporate debt and Treasuries.
Examples include the Vanguard Long-Term Bond ETF (BLV, with an RSI of 82), the iShares TIPS Bond ETF (TIP; RSI of 79) and the Vanguard Total Bond Market ETF (BND, 78).
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Source: ETF Research Center
CFTC Approves Final Swap Dealer Capital Rule at July 22 Open Meeting
July 22, 2020--The Commodity Futures Trading Commission at its open meeting today approved a final rule regarding new capital and financial reporting requirements for swap dealers (SDs) and major swap participants (MSPs). Adoption of this rule marks the completion of the CFTC's required rulemakings under Section 731 of the Dodd-Frank Act, which was enacted 10 years ago this week.
Final Rule: Capital Requirements of Swap Dealers and Major Swap Participants
On a 3-2 vote, the Commission approved a final rule imposing new capital requirements on SDs and MSPs that are not subject to supervision by a banking regulator, and imposing financial reporting requirements for SDs and MSPs generally. The final rule provides SDs with the option to elect one of three alternative methods to establish and meet minimum capital requirements, depending on the characteristics of their business:
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Source: CFTC.gov
SEC disclosure change would allow activists to 'go dark', lawyers warn
July 22, 2020--Only largest hedge funds would have to detail equity stakes under proposed rules
Activist investors in the US stand to be big beneficiaries of a new rule from Wall Street's top regulator that would allow most hedge funds to keep their equity stakes secret.
For more than four decades, any investor with $100m or more in US-listed securities has been required to detail their holdings to the US Securities and Exchange Commission every quarter. Under proposed new rules, that would step up to $3.5bn, leaving just 550 of the world’s largest investors reporting their bets.
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Source: FT.com
Alerian Midstream Energy Dividend Index Selected by HANetf for European UCITS ETF
July 22, 2020--Alerian, a leading independent index provider focused on building innovative, index-based investment strategies, announced today that one of its dividend-weighted indexes, the Alerian Midstream Energy Dividend Index (AEDW), has been selected for a European UCITS ETF on the HANetf white-label platform.
Benchmarked to the Alerian Midstream Energy Dividend Index (AEDW), the Alerian Midstream Energy Dividend UCITS ETF (MMLP), will serve a European investor base focused on dividend strategy and income generation with potential for enhanced performance and risk-adjusted returns. The Irish-domiciled ETF will be listed on the London Stock Exchange later this month.
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Source: Alerian
Climate change poses a 'systemic threat' to the economy, investors with $1 trillion at stake warn the Fed and SEC
July 21, 2020-Pension funds and other big investors want regulatory help on climate-change risk
The Federal Reserve, the Securities and Exchange Commission and other financial regulators should act on climate-change concerns to avoid economic disaster, a letter from pension funds and other investors representing almost $1 trillion in assets urges.
The U.S. has sustained more than $1.775 trillion in costs from more than 265 climate-related extreme weather events since 1980, by some measures, and more than $500 billion in economic losses between 2015 and 2019.
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Source: marketwatch.com
Robinhood Suspends Launch Of U.K. Arm To Focus On Core U.S. Business
July 21, 2020--Trading platform Robinhood has suspended its launch in the U.K. indefinitely in efforts to focus on its core U.S. market, and around a month after the company committed to making changes following the suicide of a 20-year-old customer.
Robinhood said in a statement: "We are refocusing our efforts on strengthening our core business in the US," adding that their global expansion plans are "on hold for now."
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Source: forbes.com
Tidal ETF Services Partners with Blue Tractor to Offer Non-Transparent ETFs
July 21, 2020--Tidal ETF Services LLC (Tidal), an innovative leading provider of Exchange Traded Fund (ETF) services with over $1 billion in asset under administration (AuA), today announced it has entered into a license agreement with New York-based Blue Tractor Group, LLC ("Blue Tractor") for their novel Shielded AlphaSM ETF structure.
Tidal provides comprehensive white label services including strategic guidance, product planning, trust and fund services, legal support, operations support, marketing and research, and distribution support services. Toroso Asset Management will serve as the advisor to ETFs in the Tidal ETF Trust that leverage the Shielded AlphaSM model.
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Source: Tidal ETF Services LLC
ETFGI reports ETFs and ETPs listed in Canada reach a new record of 159.58 billion US dollars at the end of June 2020
July 17, 2020--ETFGI, a leading independent research and consultancy firm covering trends in the global ETFs/ETPs ecosystem, reported today that ETFs listed in Canada saw net inflows of US$2.37 billion during June, bringing year-to-date net inflows to US$16.81 billion which are significantly higher than the US$7.57 billon gathered at this point in 2019.
At the end of the month, Canadian ETF assets increased by 4.1%, from US$153.29 billion at the end of May to US$159.58 billion a new record high at the end of June. At the end of June 2020, the Canadian ETF industry had 809 ETFs, with 979 listings, listings, assets of US$160 Bn, from 36 providers on 2 exchanges according to ETFGI's June 2020 Canadian ETFs and ETPs industry landscape insights report, an annual paid-for research subscription service. (All dollar values in USD unless otherwise noted.)
Highlights
Assets invested in ETFS/ETPs in Canada reach a new record high of $159.58 billion at the end of June.
YTD net inflows of $16.81 billion are much higher than $7.58 billion had gathered at this point last year.
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Source: ETFGI
IMF-United States of America: Staff Concluding Statement of the 2020 Article IV Mission-The Impact of the Pandemic
July 17, 2020-The longest expansion in U.S. history has been derailed by the unanticipated advent of COVID-19. To preserve lives and support public health, it was necessary to put in place a broad-based shutdown of the U.S. economy in March. Despite the gradual easing of state lockdown restrictions and lifting of stay-at-home orders starting in late April, the collateral economic damage has been enormous. First, and foremost, more than 130,000 Americans have tragically lost their lives and many more have become seriously ill. Almost fifteen million Americans have lost their jobs, many small and large businesses are under financial stress, and future prospects are highly uncertain.
Reopening decisions will have to be handled carefully to mitigate the economic costs while containing the ongoing rise in COVID-19 infection rates.
It will likely take a prolonged period to repair the economy and to return activity to pre-pandemic levels. All in all, globally there will be difficult months and years ahead and it is of particular concern that the number of COVID-19 cases is still rising.
The poorest households face particularly precarious prospects. The economic costs of the crisis are being borne disproportionately by the poor and vulnerable, bringing into stark relief deep inequities that have long afflicted the U.S. The pandemic has also underscored some of the structural shortcomings of the U.S. health system whereby the provision of healthcare is fragmented, decentralized, predominantly employer-based, at high cost, and with a significant share of low-income households lacking coverage. The nature of the pandemic has created particularly large strains for labor intensive, face-to-face services (which tend to employ a large share of lower-income workers) and the unemployment rate among lower income households, that have few financial buffers, is expected to remain high for a protracted period. Poverty rates and other social strains are expected to exceed those that were experienced in the wake of the global financial crisis.
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Source: IMF
Wall Street cuts forecasts for Fed balance sheet growth
July 17, 2020--An expansion of the Federal Reserve's balance sheet has stalled, leading strategists to pare down their predictions for the scale of the US central bank's interventions in financial markets this year.
For the week ending July 15, the size of its balance sheet steadied at $7tn, a small uptick from the week before but roughly $210bn lower than the peak reached on June 10.
The incremental rise-which comes after a 71 per cent expansion of the balance sheet since the start of year-follows a period of modest or declining usage for the emergency programmes the Fed had put in place since March to shore up markets affected by the coronavirus outbreak.
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Source: technocodex.com
