Global ETF News Older than One Year
Average daily volume of 8.5 million contracts at Eurex Group in January 2014
February 3, 2014--In January 2014, the international derivatives markets of Eurex Group recorded an average daily volume of 8.5 million contracts (January 2013: 8.6 million). Of those, 5.5 million were Eurex Exchange contracts (January 2013: 5.9 million), and 3.0 million contracts (January 2013: 2.7 million) were traded at the U.S.-based International Securities Exchange (ISE). In total, 121.6 million contracts were traded at Eurex Exchange and 62.6 million at ISE.
At Eurex Exchange, the equity index derivatives segment totaled 58.4 million contracts compared with 47.9 million in January 2013. The future on the EURO STOXX 50® Index recorded 21.1 million contracts. The options on this blue chip index totaled 24.9 million contracts. DAX Index Futures recorded 2.4 million contracts while the DAX options reached another 3.4 million contracts. The Eurex KOSPI Product grew by 24 percent year-on-year and recorded 1.9 million contracts. Options on the RDX USD Index reached a new monthly all-time high with around 138,000 contracts.
Source: Eurex
ETF Securities-Precious Metals Weekly-Gold Rallies Most in 5 Months as Emerging Market Crisis Drives Demand
February 3, 2014--Gold rallied the most in five months, one of the few assets to record a positive price
performance in January. Gold ended the first month of 2014 as one of the best performing assets, gaining of 3.9% over the month. The S&P 500 declined 3.5%, the US dollar rallied
and emerging markets equities as the Fed began tapering its bond purchasing program.
Gold priced in the Russian Ruble, Turkish Lira and South African Rand gained an average of 9% in January. In Argentine peso terms the gold price increased a whopping 27% on the month. After being viewed as a “slam dunk short” by some analysts in the latter part of last year, gold versus equity sentiment so far in 2013 has shifted-the question is the duration and magnitude of the change. Last week, long gold ETPs received the largest inflows since August 2013 as the metal regained its safe haven status. Emerging markets jitters put downward pressure on platinum and palladium prices last week, although, accelerated strike activity in South Africa helped drive a gain in the platinum price in January. In the near-term, with emerging markets still in flux, the gold price is likely to remain supported.
Emerging market turmoil highlights gold's appeal as a long term wealth preserver.
Following the sharp depreciation of the Argentine peso and Turkish lira in recent weeks and
less monetary stimulus from the Fed, current account deficit emerging markets countries
may see further volatility as markets adjust to continued tapering from the US Fed.
Source: ETF Securities
Emerging markets are badly served by ETFs
February 2, 2014--Investment vehicles have helped to create another boom and bust cycle
Money is flowing out of the emerging markets.
A debate is raging over whether this is the fault of the US Federal Reserve, which has effectively encouraged investors to bring their money back home...
Source: FT.com
At $64 trillion, market cap of global exchanges hits 10-year high
February 2, 2014--The overall market capitalisation of bourses worldwide crossed $64 trillion last year, the highest level in more than a decade, on the back of improving investor sentiment.
The level touched in 2013 is also the highest since the 2008 Lehman Brothers crisis that had pushed the global financial system into a tizzy.
Source: Hindu Buiness Line
Currency crisis at Chinese banks 'could trigger global meltdown'
A rise in foreign funding at China's banks poses a threat for international lenders
February 1, 2014--The growing problems in the Chinese banking system could spill over into a wider financial crisis, one of the most respected analysts of China's lenders has warned.
Charlene Chu, a former senior analyst at Fitch in Beijing and now the head of Asian research at Autonomous Research, said the rapid expansion of foreign-currency borrowing meant a crisis in China's financial system was becoming a bigger risk for international banks.
Source: The Telegraph
Investors pull $12bn from EM stocks
January 31, 2014--The four biggest global stock markets recorded sharp losses in January for the first time in four years, as weeks of turmoil in emerging markets spread to the developed world.
Stocks in the US, UK, Europe and Japan have not posted simultaneous declines for January since 2010 when the eurozone debt crisis was at its height, prompting investors to warn the inauspicious start did not bode well for the rest of the year. US central bank tapering and a slowing Chinese economy are likely to weigh heavily on sentiment.
Source: FT.com
BATS Global Markets and Direct Edge Receive SEC Approval to Merge
All Regulatory Approvals Now Complete;
Transaction Close Expected Within Days
January 31, 2014--BATS Global Markets, Inc. (BATS) and Direct Edge Holdings LLC (Direct Edge) today announced the receipt of Securities and Exchange Commission (SEC) approval for their merger and expect to close the transaction within days.
The merger of BATS and Direct Edge, which was announced in August 2013, combines two customer-focused securities exchange operators under the BATS Global Markets brand to drive further innovation and better serve the trading and investing community.
Source: BATS
Vanguard's CEO dances to a fanatical discount tune
January 31, 2014--Bill McNabb has his dancing shoes on after bopping with his wife at The Commitments, the recently opened London musical.
"We love London," enthuses the Vanguard chief executive.
But show tunes are not the real reason for his good humour-an influx of client assets are.
Source: FT.com
SPDR Weekly Market Report
January 31, 2014--ECONOMIES: The Fed tapers again. GDP rises solidly in the US, Canada and the UK. Inflation remains uncomfortably low in the
eurozone. Industrial production jumps in Japan. Inflation remains benign in Australia. GDP rises in Spain.
MARKETS: Risk appetites continue to erode on emerging market concerns. Equities are mostly lower again. G7 government bonds remain bid. USD is broadly bid. Oil and gold are down.
NEXT WEEK PREVIEWED SPOTLIGHT:
The Reserve Bank of Australia, the Bank of England, and the European Central Bank should leave administered rates
unchanged. Employment should rise solidly in the US. Unemployment likely edges lower in Canada.
THE WEEK IN REVIEW
US
THE FED met widely held expectations by tapering again.
Specifically, the monetary policy setting Federal Open
Market Committee (FOMC) unanimously voted to reduce
the pace of asset purchases another $10 billion to $65 billion
per month ($35 billion longer-dated Treasuries and $30
billion mortgage-backed securities) beginning in February.
Moreover, the FOMC signaled that it expected to taper
in "further measured steps "at future meetings, which
keeps it on schedule to end new asset purchases in the
fourth quarter. Even as it tapers, the FOMC is continuing
its reinvestment program and has flashed no signals that
reinvestment will end any time soon.
For more information, including product fact sheets and related whitepapers:
Source: SSgA
BlackRock ETP Landscape-ETP Flows Quarterly-Duration Rotation
January 31, 2014--Highlights include:
Fixed income ETPs held $354 billion in assets globally at year end. They account for about 15% of total assets-three times their share in 2005 but down from a high of 17.4% at the end of 2012.
The big trend in 2013? A "great rotation" into funds focusing on shorter maturity bonds. Investors have been yanking money out of broad maturity funds and ploughing it into short duration and floating rate funds as they seek protection from higher interest rates.
The ratings distribution of the average corporate bond ETP is changing. Investment grade funds have declined in quality whereas high yield ETPs have risen (slightly). The reasons include ratings downgrades of (investment grade) financial issuers and increased flows into short-maturity high yield ETPs. These funds tend to have a higher credit quality.
Source: BlackRock ETP Landscape Research
