Americas ETP News
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INSIGHT-Vanguard price cuts rattle the brokers who sell its funds
June 16, 2015--The Vanguard Group, which in 40 years became the biggest mutual fund company by selling low-priced, market-matching funds, is competing with some of its best customers-the brokers and advisers who funnel client assets to its funds-by offering personalized service to investors with more than $500,000.
Making things worse for outside advisers, Vanguard is charging 0.3 percent of assets annually or less, compared with the 1 percent to 3 percent common among brokers and independent financial advisers.
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Source: Reuters
MSCI Launches Indexes with the ITG Fair Value Model
June 16, 2015--MSCI Inc. (NYSE: MSCI), a leading provider of research-based indexes and analytics, today announced the launch of MSCI Indexes with the ITG Fair Value Model, which will make it simpler foractive mutual fund managers to explain some of the tracking error that may be linked to the fair value pricing adjustment of their international and global funds.
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Source: MSCI
Credit Suisse AG Announces the Reverse Split of its TVIX ETN
June 16, 2015--Credit Suisse AG announced today that it will implement a 1-for-10 reverse split of its VelocityShares(TM) Daily 2x VIX Short Term ETN ("TVIX"), expected to be effective as of June 23, 2015.
On June 25, 2015, holders of record will receive one reverse split-adjusted ETN for every ten units of TVIX. In addition, such holders of record that hold a number of units of ETNs not evenly divisible by ten will receive a cash payment for any fractional number of units remaining of TVIX (the "partials").
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Source: Credit Suisse AG
'Direct investors' a growing force in private markets
June 16, 2015--Private equity executives are rarely fazed by anyone on their way to'turning lots of investors' fees, and plenty of debt, into (preferably) lots of investors' money,
plus French châteaux and ivy-strewn university endowments.
Then there are the Canadians.
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Source: FT.com
CBO The 2015 Long-Term Budget Outlook
June 16, 2015--If current laws remained generally unchanged, federal debt held by the public would exceed 100 percent of GDP by 2040 and continue on an upward path relative to the size of the economy-a trend that could not be sustained indefinitely.
The long-term outlook for the federal budget has worsened dramatically over the past several years, in the wake of the 2007-2009 recession and slow recovery. Between 2008 and 2012, financial turmoil and a severe drop in economic activity, combined with various policies implemented in response to those conditions, sharply reduced federal revenues and increased spending. As a result, budget deficits rose: They totaled $5.6 trillion in those five years, and in four of the five years, they were larger relative to the size of the economy than they had been in any year since 1946. Because of the large deficits, federal debt held by the public soared, nearly doubling during the period. It is now equivalent to about 74 percent of the economy’s annual output, or gross domestic product (GDP)-a higher percentage than at any point in U.S. history except a seven-year period around World War II.
view the CBO 2015 Long-Term Budget Outlook
Source: Congressional Budget Office (CBO)
Three Citigroup ETNs Vulnerable to Unusual Trading After Firm Suspends New Shares
June 16, 2015--Citigroup (C) indefinitely suspended the ability to create new shares in its family of three exchange-traded notes on Tuesday, leaving the products vulnerable to unusual trading behavior.
This topic sounds arcane but should be a huge red flag for shareholders: If no mechanism exists to create new shares, ETN prices can veer away from their net asset values in bouts of buying or selling, like closed-end funds.
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Source: Barron's
Hedge-Fund Bet Hits Pensions
Firms moved portfolios away from stock market to reduce risk, but missed out on rally
June 16, 2015--U.S. companies from Ford Motor Co. to supermarket chain Kroger Co. have boosted their pension plans' bets on hedge funds, a shift that left many of them on the short end of a stock-market rally.
Large corporate pension funds have quadrupled the share of their portfolios invested in hedge funds over the past five years, according to an analysis of about 300 firms in the S&P 500 by Wilshire Consulting.
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Source: Wall Street Journal
UPDATE 1-Deutsche Boerse eyes possible bid for FX platform 360T-source
June 15, 2015--Deutsche Boerse is looking at the possibility of buying currency trading platform 360T, a source familiar with the situation said on Monday, although it was not yet clear if the German exchange operator will place a binding bid.
Deutsche Boerse declined to comment on whether it was bidding, while 360T, one of a handful of multi-bank, multi-user platforms which have revolutionised foreign exchange trading over the past decade, was not immediately available to comment.
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Source: Reuters
Interview series: Investment Factors that drive ETF performance
June 15, 2015--In this latest piece Dan Weiskopf of Access ETF Solutions met with Salvatore Bruno, the Chief Investment Officer of IndexIQ.
Sal is responsible for research and product development at IndexIQ’s alternative investment strategies. As the developer of the first US based family of hedge fund replication strategy indices, Sal was early to recognize the benefits of the ETF wrapper and define the IndexIQ investment methodologies by specific factors and rules.
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Source: Access ETF Solutions
Pimco to Watchdogs: 'Consider the Pimco Experience'
June 15, 2015--It's not surprising that Pacific Investment Management Co. says that asset managers and their funds should not be designated as systemically important.
But what is interesting is Pimco's reasoning.
In a response to the most recent consultation on ways to designate systemically important fund managers, chief executive Douglas Hodge highlighted his firm's experience dealing with investors pulling large chunks of cash following the sudden departure of Bill Gross last September.
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Source: Wall Street Journal
