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Gold rules 2012 U.S. commodity ETF money with Spyder and iShares
US monetary easing, economy fuel rush into gold ETFs
Spyder attracts $5.3 bln net, iShares $2.4 bln
Lipper universe of U.S. commods products see $11 bln inflow
PIMCO's institutional commodity fund bleeds most money
January 23, 2013--Gold dominated the money that flowed into U.S. commodity exchange-traded funds last year, with 70 percent of investments going into just two funds, after a new round of stimulus in the world's largest economy, Thomson Reuters data showed.
SPDR Gold Trust, also known as Spyder Gold, saw the biggest net inflow of $5.3 billion in 2012, according to data by Lipper, a Thomson Reuters company. BlackRock's iShares Gold drew the second largest net amount of $2.4 billion.
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Source: Reuters
US Department of the Treasury-
January 23, 2013--The Economic Statistics- Monitoring the Economy for U.S. Department of the Treasury has recently been updated.
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Source: US Department of the Treasury
ICG Group selling Investor Force for $23.5 million
January 23, 2013--ICG Group, a technology company that operates cloud-based software and services, is selling software provider Investor Force Holdings Inc. to MSCI Inc. for $23.5 million in cash.
MSCI offers a variety of performance, risk management and corporate governance products and services. These include indices and credit analytics. The New York company's clients include asset managers, banks, hedge funds and pension funds.
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Source: Bloomberg Businessweek
Fragmented U.S. regulatory system stalls Dodd-Frank rules
January 23, 2013--The U.S. financial regulatory system remains fragmented two and a half years after Congress passed the Dodd-Frank law, and time-consuming coordination among regulators has stalled its biggest reforms, a government watchdog said in a report on Wednesday.
The U.S. Government Accountability Office said that as of December, regulators had finished fewer than half of the new rules called for by the 2010 law, which lawmakers crafted in response to the 2007-2009 U.S. financial crisis.
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Source: Thomson Reuters
Morgan Stanley-ETF Weekly Update
January 22, 2013--US ETF Weekly Update
Weekly Flows: $2.9 Billion Net Inflows
ETF Assets Stand at $1.4 Trillion, up 4% YTD
One ETF Launch Last Week
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US-Listed ETFs: Estimated Flows by Market Segment
ETFs posted net inflows of $2.9 bln last week, the 9th consecutive week of net inflows
Net inflows were led by International Developed Market Equity ETFs ($2.6 bln in net inflows last week)
US Large-Cap Equity ETFs exhibited net outflows of $4.8 bln (primarily attributed to the SPDR S&P 500 ETF (SPY))
ETF assets stand at $1.4 tln, up 4% YTD
13-week flows were mostly positive among asset classes; combined $63.5 bln in net inflows
International Equity ETFs have exhibited net inflows of $32.2 bln over the past 13 weeks (57% into EM Equity ETFs)
Over the last 13 weeks, Leveraged/Inverse ETFs posted the largest net outflows of any category ($1.0 bln)
US-Listed ETFs: Estimated Largest Flows by Individual ETF
Vanguard FTSE Emerging Markets ETF (VWO) posted net inflows of $676 mln last week, the most of any ETF
Despite announcing a meaningful index transition during the beginning of Q4 (currently taking place), in the 16 weeks since the announcement, VWO has generated net inflows in 14 of them totaling $494 mln over the period
The SPDR S&P 500 ETF (SPY) had net outflows of $5.2 billion last week, the most of any ETF for the second consecutive week
The WisdomTree Japan Hedged Equity Fund (DXJ) generated net inflows of $585 mln last week and over the past 13 weeks has exhibited net inflows of $1.4 bln (65% of current market cap); DXJ hedges out currency risk and focuses on Japanese exporters
US-Listed ETFs: Short Interest Data Unchanged: Based on data as of 12/31/12
iShares Russell 2000 Index Fund (IWM) had the largest decline in USD short interest at $2.1 bln
IWM’s shares short are at their lowest level since 10/15/09
Interestingly, the Market Vectors Gold Miners ETF (GDX) exhibited the third largest increase in short interest while the SPDR
Gold Trust (GLD), which holds the physical metal, had the second largest decline in short interest
Aggregate ETF USD short interest decreased by $70 mln over the past two weeks ended 12/31/12
The average shares short/shares outstanding for ETFs is currently 5.3%
Smaller ETFs by market cap may skew results (three of the top 10 with the highest % of shares short have market caps <$5 mln)
Retail ETFs consistently are some of the most heavily shorted ETFs (shares short as a % of shares outstanding)
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
Source: Bloomberg, Morgan Stanley Smith Barney Research. Data estimated as of 1/18/13 based on daily change in share counts and daily NAVs.
$9.8 billion in total market cap of ETFs less than 1-year old
Newly launched Active ETFs account for 47% of the market cap of ETFs launched over the past year; PIMCO Total Return ETF (BOND) is the largest actively managed ETF with a market cap of $4.0 bln
One new ETF listing and three closures YTD (13 announced closures)
The top 10 most successful launches make up 70% of the market cap of ETFs launched over the past year
Six different ETF sponsors and two asset classes represented in top 10 most successful launches
Seven out of the 10 most successful launches over the past year have an income orientation
Despite not cracking the top 10 most successful launches over the past year, the iShares MSCI Emerging Markets Asia Index Fund (EEMA) generated net inflows of $103 mln last week, the most of any recently launched ETF
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Source: Morgan Stanley
US active managers disappoint in 2012
January 22, 2013--Performance issues continued to dog active fund managers trying to deliver superior returns to the US stock market in 2012, according to analysts at Bank of America Merrill Lynch.
Active fund managers of large US stocks registered their best year since 2009 but two-thirds still underperformed the US stock market in 2012 with the average fund lagging the benchmark by 1.3 percentage points.
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Source: FT.com
Alt ETF shop QuantShares looking to tie up
January 22, 2013--The investment adviser to alternative exchange traded fund manager QuantShares has launched a search for a "strategic partner."
FFCM said it hired Berkshire Capital Securities to help in the search, which is focusing on potential partners with expertise in distribution and marketing.
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Source: FT.com
Deutsche Bank-Synthetic Equity & Index Strategy-North America-ETF & Markets- ETF Liquidity & Stock Impact
January 22, 2013--ETF liquidity: more than meets the eye
ETF liquidity goes beyond the listed ETF share volume. Total ETF liquidity considers the ETF shares and the underlying stock liquidity. Investors that learn how to access the underlying liquidity of the ETF can highly benefit from it.
Index-related flow impact tends to be short-lived and concentrated
Index related flows need to be sizeable and stock liquidity needs to be limited in order to generate market impact. Even then, market impact tends to be short-lived and concentrated on just a few names.
Index membership can have significant impact on the behavior of stocks
Index membership has a significant impact in the liquidity and correlation profile of stocks. Addition to a domestic (US) index translates in higher and more stable stock liquidity, at the cost of a higher index correlation; the contrary is true for deletions. It is not clear, however, whether this is due to passive money linked to the index or active money benchmarked to it.
ETF impact on the underlying stocks is limited
Higher ETF ownership on small cap names tends to increase their liquidity. ETF ownership and Market Cap are both positively related to stock return pairwise correlations, but the impact from Size seems to be much more relevant. Consistent market impact from ETF primary market activity is very unlikely; and even among those less liquid benchmarks where the chance is higher, the impact should be limited to just a few names and few occasions.
reuest report
Source: Deutsche Bank - Synthetic Equity & Index Strategy - North America
First Asset launches Canadian provincial bond ETF
January 21, 2013--Canadian money manager First Asset said on Monday it had launched the first exchange-traded fund designed to track the country's provincial government debt market.
The ETF, which will aim to replicate the Canadian DEX Universe Provincial Bond Index less expenses, will hold investment-grade provincial debt, which offers higher yields than top AAA-rated federal government bonds.
The First Asset DEX Provincial Bond ETF started trading on the Toronto Stock Exchange on Monday and stood at C$10.00 per unit by midday.
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Source: Reuters
ETFs open doors to other institutional accounts
January 21, 2013--On the eve of the 20th anniversary of the first U.S. listed exchange-traded fund -the SPDR S&P 500 ETF-both institutional investors and money managers are still hashing out their views on exchange-traded products.
As assets continue to flow into ETPs — $1.4 trillion in the U.S. at the end 2012 and $188 billion in net new flows, the structure has become too difficult to ignore, but the investment decision is still a challenge for large investors comparing ETFs to institutional funds, commingled trusts and separately managed accounts.
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Source: Pensions & Investments
