Americas ETP News
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IMF Working paper-Intra-Regional Spillovers in South America: Is Brazil Systemic after All?
June 5, 2012--Summary: Shocks stemming from Brazil-the large neighbor in South America- have historically been a source of concern for policy-makers in other countries of the region. This paper studies the importance of Brazil's influence on its neighboring economies, documenting trade linkages over the last two decades and quantifying spillover effects in a Vector Auto Regression setting.
While trade linkages with Brazil are significant for the Southern Cone countries (Argentina, Bolivia, Chile, Paraguay, and Uruguay), they are very weak for others. Consistent with this evidence, econometric results show that, while the Southern Cone economies (especially Mercosur’s members) are vulnerable to output shocks from Brazil, the rest of South America is not. Spillovers can take two different forms: the transmission of Brazil-specific shocks and the amplification of global shocks—through their impact on Brazil’s output. Finally, we also find suggestive evidence that depreciations of Brazil’s currency may not have significant impact on output of its key trading partners.
view the IMF Working paper-Intra-Regional Spillovers in South America: Is Brazil Systemic after All?
Source: IMF
Moving Assets Into ETFs
June 5, 2012--ETF sponsors will tell you that the three biggest issues in the industry are education, education and education, especially in relation to the RIA channel.
There are countless numbers of websites, white papers, webinars and yes even bloggers and columnists that dissect the ETF structure and all of its usefulness but if you’re looking to move your client’s assets out of mutual funds and into ETFs, there is not much independent information to guide you.
There are currently $1.3 trillion in ETFs and close to $12 trillion in mutual funds. As passive investing becomes a larger portion of portfolio construction, we could see three, four or even five trillion dollars move out of Mutual Funds and into ETFs in the coming years. The process to move that amount of capital creates opportunities, challenges and the need for more education.
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Source: By Richard Keary for Wealth Management
VIX Investors Head to the Vix-its.
June 5, 2012--While the VIX hasn't been on a moon shot- a fact noted earlier today on MarketBeat-it has moved higher since the latest eruption of worries about Europe and the pace of global growth.
On the surface, one might think that another Euro-land freak-out would have investors clamoring for exchange traded funds that track the VIX.
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Source: Wall Street Journal
First Asset Growth Spurs Name Changes and New Brand Strategy
XTF Capital ETFs becomes First Asset ETFs; Criterion Mutual Funds becomes First Asset Mutual Funds
June 5, 2012--First Asset announced today that it has consolidated the branding of its three product lines -exchange traded funds, mutual funds and closed-end funds - under the existing "First Asset" umbrella, which to date referred only to its closed-end fund division.
Specifically, its mutual fund division, Criterion Mutual Funds, will now be called First Asset Mutual Funds and its ETF division, XTF Capital, will now be called First Asset Exchange Traded Funds.
The name changes reflect a growth story that has seen First Asset and its divisions grow over 400 per cent in three years - from $600 million in assets in 2009 to $2.6 billion in 2012.
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Source: FIRST ASSET
U.S. derivatives industry slams CFTC's 85 pct rule
June 5, 2012--CFTC hosts roundtable on Dodd-Frank's 85 percent rule
Derivatives exchanges push back on the reform
Gensler said final rule slated for vote later this summer
June 5, 2012--The U.S. derivatives industry on Tuesday criticized a rule it says would force exchanges to delist hundreds of contracts because of low volume, stifling innovation and damaging market liquidity.
The rule aims to protect price discovery in the swaps and futures markets by requiring at least 85 percent of a contract's trading to occur on an exchange's centralized market.
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Source: Reuters
BM&FBOVESPA -ETF financial volume to May surpasses figure for whole of 2011
The Exchange offers ETFs that track the performances of 13 indices, such as Ibovespa, the Dividend Index and the Sustainability Index
June 5, 2012--The financial volume accumulated this year by ETFs (investment funds in indices whose shares are traded on BM&FBOVESPA like stocks and which are accessible to all investors) has already surpassed by 5.78% the total traded over all of 2011.
From January to May the ETF trading volume was BRL 12.8 billion, in 401,117 transactions. In 2011 there were 577,723 transactions and a financial volume of BRL 12.1 billion.
There are currently 13 ETFs traded on BM&FBOVESPA and in May they obtained a financial volume of BRL 4.02 billion in 128,355 transactions, a volume three times higher than that of January (BRL 1.4 billion). The BOVA11 ETF fund, which tracks the performance of the Ibovespa, had a financial volume of BRL 3.9 billion in the month, with 124.638 transactions. The second most traded ETF was PIBB11 which tracks the IBrX-50, with 2,217 trades and a financial volume of BRL 43.5 million. In April, the 12 ETFs traded on BM&FBOVESPA totaled 73,632 transactions and a financial volume of BRL 2.69 billion.
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Source: BM&FBOVESPA
Global X Funds Launches Top Guru Holdings Index ETF (GURU)
June 5, 2012--Global X Funds, the New York based provider of exchange traded funds (ETFs), today launched the Global X Top Guru Holdings Index ETF (NYSE Arca: GURU), which allows investors to tap into the combined expertise of the largest hedge fund managers.
Hedge funds spend tens to hundreds of millions on talent and research to uncover the most attractive investment opportunities, and in exchange typically charge a 2% management fee and a 20% performance fee. These types of asset management firms are often restricted to a limited number of investors and typically require a large minimum investment that makes them difficult to access. However, on a quarterly basis, all hedge funds with more than $100 million in U.S. equity investments are required to publish their holdings in a publicly available document called the 13F.
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Source: Global X
MF Global Dodged Capital Requirements, Report Says
June 5, 2012-Under pressure from regulators last summer to increase its capital cushion, MF Global moved some of its risky European debt holdings to an unregulated entity in an effort to avoid having to raise extra money, according to a new report.
The revelation raises new questions about MF Global’s actions in its last months, in particular, how it responded to regulators. The brokerage firm had previously disclosed that it had met the capital requirements, but never mentioned that it had transferred some bonds rather than raising additional money.
The shift was detailed in a report by Louis J. Freeh, the trustee overseeing the bankruptcy of MF Global.
view the FIRST REPORT OF LOUIS J. FREEH, CHAPTER 11 TRUSTEE OF MF GLOBAL HOLDINGS LTD., et al.,
FOR THE PERIOD OCTOBER 31, 2011 THROUGH JUNE 4, 2012
Source: NY Times
KraneShares files with the SEC
June 5, 2012--KraneShares has filed a amended and restated application for exemptive relief with the SEC.
view filing
Source: SEC.gov
CFTC's Division of Market Oversight Issues Updated Guidebook for Part 20 Reports
Guidebook Provides Detailed Instructions for Submitting Large Swaps Trader Reports to the Commission
June 5, 2012--The Commodity Futures Trading Commission's (CFTC) Division of Market Oversight (Division) today issued an updated version of the Guidebook for Part 20 Reports, which provides additional guidance and detailed instructions for submitting large swaps trader reports to the Commission.
On July 22, 2011, the Commission published Part 20 of the Commission’s Regulations requiring large trader reports for certain physical commodity swaps. Clearing organizations and clearing members are currently reporting on both cleared and uncleared swaps. In addition, for entities filing less than fully compliant reports pursuant to Division no-action relief available until July 2, 2012, the Division requires month-end open interest reports to be submitted to the Commission through June 2012.
The Guidebook includes a data dictionary for mapping data elements to a record layout, interim and final reporting formats and record layouts for the submission of reports and 102S filings, and multiple examples for converting and reporting swaps in futures equivalent units. The updated version contains non-substantive edits as well as providing the specifics of reporting in the FIXML format. In addition, the updated Guidebook includes a description of common reporting scenarios.
