Americas ETP News
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S&P Dow Jones Indices Announces Changes To The S&P/TSX Canadian Indices
Changes In The S&P/TSX Preferred Share Indices
February 18, 2014--S&P Dow Jones Canadian Index Services will make the following changes in the S&P/TSX Canadian Indices:
Bank of Montreal (TSX:BMO) has announced that it will redeem for $CDN25.00 cash per share all of the outstanding shares of its Non-Cumulative 5-Year Rate Reset Class B Preferred Shares Series 18 (TSX:BMO.PR.N) at the close on February 25, 2014.
The shares of this issue will be removed from the S&P/TSX Preferred Share, the S&P/TSX Preferred Share Laddered and the S&P/TSX North American Preferred Stock Indices after the close of trading on Tuesday, February 25, 2014.
Source: S&P Dow Jones Indices
Morgan Stanley-US ETF Weekly Update
February 18, 2014--US ETF Weekly Update
Weekly Flows: $16.0 Billion Net Inflows
First Net Inflows in Four Weeks
ETF Assets Stand at $1.7 Trillion, Down 1% YTD
Four ETF Launches Last Week
Guggenheim Announces Actively Managed ETF Closure
US-Listed ETFs: Estimated Flows by Market Segment
ETFs posted net inflows of $16.0 bln last week, the first net inflows in four weeks
Largest weekly net inflows since the week of 9/16/13
Last week's net inflows were led by US Large-Cap ETFs at $7.7 bln; conversely, no categories exhibited significant net outflows last week
Twelve of the 15 categories we measured posted net inflows last week and five of them exhibited net inflows greater than $1 bln
ETF assets stand at $1.7 tln, down 1% YTD
13-week flows remain positive among asset classes; combined $19.5 bln in net inflows
Fixed Income ETFs have generated net inflows for three consecutive weeks, totaling $14.0 bln; as referenced last week, this is a reversal from the net outflows we witnessed during the second half of last year
International - Emerging ETFs have seen their ETF market share shrink to 7% from 12% in the last year driven by weak equity market performance and net outflows; over the last 13 weeks, International - Emerging ETFs have exhibited net outflows of $12.1 bln, the most of any category
US-Listed ETFs: Estimated Largest Flows by Individual ETF
SPDR S&P 500 ETF (SPY) posted net inflows of $6.0 bln this past week, the most of any ETF
US equity ETFs accounted for nine of the 10 ETFs to generate the largest net inflows last week, totaling $10.3 bln; interestingly, they also made up seven of the 10 ETFs to post the largest net outflows last week ($2.4 bln in net outflows)
Notably, the iShares US Industrials ETF (IYJ) and the iShares US Energy ETF (IYE) each posted net outflows that account for approximately 50% of their current market capitalization; First Trust Energy AlphaDEX Fund (FXN) also had large net outflows relative to its market cap (small market cap to begin with)
Over the last 13 weeks, the iShares 3-7 Year Treasury Bond ETF (IEI) has exhibited net inflows of $3.7 bln, the most of any ETF; investors have flocked to high quality Fixed Income ETFs amid a volatile start to 2014, especially in equity markets
US-Listed ETFs: ETF Dollar Volume
ETF monthly $ volume as a % of listed trading volume declined to 25% in January, which is below the five-year average of 28%
Over the last five years, ETF monthly $ volume as a % of listed trading volume peaked in August 2011 at 36%
ETF $ volume was $319 bln last week, down $180 bln from the prior week, but still 6% above its 13-week average
Fixed Income ETFs accounted for 5% of ETF $ volume last week, however make up 15% of ETF market share, signifying longer holding periods
US-Listed ETFs: Short Interest Data Updated: Based on data as of 1/31/14
The SPDR S&P 500 ETF (SPY) had the largest increase in USD short interest at $2.4 bln
The iShares MSCI Emerging Markets ETF (EEM) also had a big jump in short interest ($1.1 bln increase); EEM's shares short are at their highest level since 6/14/13 as investors continue to flee emerging markets
598 ETFs exhibited short interest increases while 640 experienced short interest declines over the last period
Aggregate ETF USD short interest increased by $3.0 bln over the period ended 1/31/14
The average shares short/shares outstanding for ETFs is currently 4.2%, down from 4.4% last period
Six of the 10 most heavily shorted ETFs as a % of shares outstanding are sector/industry related
For the third consecutive period, the SPDR Oil & Gas Exploration & Production ETF (XOP) was the most heavily shorted ETF with shares short as a % of shares outstanding of 366%
Based on multiple borrowings and the ability to continuously create new shares, shares short as a % of shares outstanding can exceed 100% (only seven ETFs exhibited shares short as a % of shares outstanding greater than 100%)
US-Listed ETFs: Most Successful Recent Launches by Assets
$8.1 bln in total market cap of ETFs less than 1-year old
Active ETFs account for 24% of the market capitalization of ETFs launched over the past year, the most of any category, followed closely by newly launched Fixed Income ETFs with 23% of market capitalization
Over the last 13 weeks, International - Developed ETFs have attracted $621 mln in net inflows, the most of any group
35 new ETF listings and two closures YTD (11 additional closures announced)
The top 10 most successful launches make up 46% of the market cap of ETFs launched over the past year
Seven ETF sponsors and two asset classes (equities and fixed income) represented in top 10 most successful launches; we note that the representation of funds with an income orientation is currently five (down from seven at the end of the second quarter 2013)
Despite not cracking the top 10 most successful launches over the past year, the First Trust Global Tactical Commodity Strategy Fund (FTGC) generated net inflows of $64 mln last week, the most of any recently launched ETF; FTGC is an actively managed commodity ETF
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Source: Morgan Stanley
IMA sets out plan for overhaul of dealing commission
February 18, 2014--The Investment Management Association has set out recommendations which could see the banning of dealing commission to purchase investment research with fund groups instead paying directly for such services.
A report published today by the IMA, entitled 'The Use of Dealing Commission for the Purchase of Investment Research', lays out a series of measures for good practice surrounding research payments and a possible overhaul of the existing model of dealing commissions.
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Source: FundWeb
SEC to roll out cross--border derivatives rules in phases
February 18, 2014--IN BRIEF
The US Securities and Exchange Commission plans to roll out final international derivatives rules in phases, combining them with new domestic rules, federal officials told MLex.
The first rules tranche, to be approved at some unspecified point in the near term, will be definitions for terms such as "US person" and bank "affiliate" to be used in domestic and international rules, they said.
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Source: mlex.com
Deutsche Asset & Wealth Management Hires Simon Mendelson to Lead Product Management and Development in the Americas
Deutsche Asset & Wealth Management Hires Simon Mendelson to Lead Product Management and Development in the Americas
February 18, 2014--Deutsche Asset & Wealth Management (DeAWM) announced today that Simon Mendelson has joined as a Managing Director and Head of Product Management and Development in the Americas. Based in New York, Mendelson reports to Jerry Miller, Head of Deutsche Asset & Wealth Management, Americas.
"His appointment will help to accelerate DeAWM’s growth strategy by aligning our product offerings with the needs of investors."
In this newly created position, Mendelson will be responsible for overseeing the development, implementation and positioning of DeAWM's investment products and solutions in the Americas. He will play a key role in aligning DeAWM's investment and distribution channels, not only to develop and deliver new products, but also to manage and optimize existing product capabilities.
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Source: Deutsche Asset & Wealth Management
DB- Synthetic Equity & Index Strategy - North America-US ETF Investment Ideas -Implementing DB's 2014 Outlook with ETFs
Febraury 17, 2014--An in-depth ETF guide to navigate markets during 2014
Find the right product for your investment theme with detailed analysis and commentary for 23 investment themes and over 75 products.
Global growth should accelerate in 2014 and favor risk assets
Global growth should benefit from a US economic strengthening, a growth comeback in the Eurozone, and a year of reforms in China.
We expect moderate gains for risk assets, with Equities once again the best performing asset class while Credit and Rates lag in a rising rate environment. Following the sell-off in 2013, EM should see further differentiation this year, as investors reward countries that are reforming. In FX, we see the continuation of the USD multi-year up-cycle. In commodities, oil should fall by ~10% on rising non-OPEC supply led by the US.
23 ETF Investment Ideas for 2014
In this report we explore 23 different investment themes and provide ETF recommendations for each of them. The first couple of sections of this report focus on the implementation of these themes, while the rest of the report presents our detailed analysis for over 75 products reviewed, and can be used as an in-depth thematic investment guide.
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Source: Deutsche Bank - Synthetic Equity & Index Strategy - North America
Research Affiliates, Citi launch corporate bond fundamental index
February 17, 2014--Investment bank Citi and fundamental indexing specialist Research Affiliates have launched a global investment-grade corporate bond index in a pioneering move to extend the smart-beta concept further into the fixed income world.
The Citi RAFI World Corporate Investment-Grade Bond index uses two factors in weighting bonds in the portfolio: long-term assets, which represents the portion of assets that long-term bondholders have a claim on, and cash flow, which reflects debt service capacity.
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Source: IP&E
Swaps market prepares for its big bang
February 17, 2014--The US swaps market is expected to begin a shift away from the predominance of telephone trading this week as it joins the 21st century in a move towards more tightly regulated electronic trading venues.
The changes are being ushered in by global regulators in the wake of the financial crisis and come into effect on Tuesday, as trading of over-the-counter derivatives moves on to so-called swap execution facilities, or Sefs.
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Source: FT.com
BMO Asset Management Inc. Launches Seven New ETFs
February 14, 2014--New equity and fixed income ETFs give investors opportunities for income and growth-Non-currency hedged and currency hedged products provide investors with more choice-Since its introduction in 2009, BMO AM's ETF business has expanded to 58 funds and more than $12 billion in AUM
"These new ETFs feature innovative approaches to fixed income investing, including new strategies and precise exposure. They also offer investors more international growth opportunities and include the first ETF in Canada that tracks a MSCI Quality Index," said Kevin Gopaul, Chief Investment Officer and Senior Vice President, BMO Asset Management Inc. "We're also adding to our unhedged suite of international ETFs to give investors more ways to access well-known market indices.
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Source: BMO Financial Group
NASDAQ OMX Files Proposed Rule Change to Permit the Listing and Trading of Exchange-Traded Managed Funds
February 14, 2014--Navigate Fund Solutions LLC (Navigate), a wholly owned subsidiary of Eaton Vance Corp. (NYSE: EV), today announced the filing by The NASDAQ OMX Group, Inc. (NASDAQ OMX) with the U.S. Securities and Exchange Commission (SEC) of a proposed rule change to permit the listing and trading of exchange-traded managed funds (ETMFs). The NASDAQ OMX filing complements the previously announced application for exemptive relief to permit the offering of ETMFs as filed by Eaton Vance Management on March 27, 2013 and most recently amended on January 23, 2014.
ETMFs are a proposed new type of open-end fund designed to bring the performance and tax advantages of exchange-traded funds (ETFs) to active investment strategies, while maintaining the confidentiality of current portfolio trading information. As described in the proposed rule change, ETMFs would trade on The NASDAQ Stock Market at prices directly linked to the fund's next-determined daily net asset value (NAV), using a new trading protocol called "NAV-based trading." In NAV-based trading, prices would vary from NAV by a market-determined premium or discount, which may be zero. Because ETMFs would provide market makers with opportunities to earn reliable arbitrage profits without intraday hedging of their inventory positions, they can be expected to trade at consistently tight spreads to NAV in the absence of full holdings disclosure.
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Source: Eaton Vance Corp.
