Americas ETP News
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Why ETFs are not Taking Over 401k
April 5, 2012--Those holding their breath waiting for ETFs to dominate the 401(k) market are turning blue, and the WSJ takes a peak at why this is so.
For one, the paper finds that ETFs are not necessarily any less expensive than institutional share classes of plain-vanilla index mutual funds. For example, Fidelity Spartan 500 Index carries expenses of 6 to 8 basis points while the SPDR S&P 500 SPY carries 10 bps in expenses.
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Source: The Mutual Fund Wire.com
BlackRock Leads ETF Boom to Global Junk Rally: Credit Markets
April 5, 2012--The $28.4 billion Blackrock Inc (BLK)-led industry of exchange-traded funds that buy U.S. junk bonds is expanding into global speculative-grade debt as the notes outperform dollar-denominated securities by the most since 2009.
BlackRock, the world’s biggest money manager, opened the first ETFs on April 3 that will invest in junk bonds from Europe to Asia after its iShares iBoxx High Yield Corporate Bond Fund in the U.S. grew to more than $14 billion in less than five years. Van Eck Global, the investment firm founded in 1955, opened its International High Yield Bond ETF the same day.
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Source: Bloomberg
SEC Puts Exchanges on Notice Over Computer-Driven Trades
April 4, 2012--More than five months before a software error ruined Bats Global Markets Inc. (BATS) (BATS)'s initial public offering, U.S. regulators put exchanges on notice that they need to do more to protect investors from technology gone awry.
The missive came in the form of a prologue to a Securities and Exchange Commission case against Direct Edge Holdings LLC in October over claims the exchange operator had weak internal controls that caused its trading system to fail.
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Source: Bloomberg Business Week
ETF Global Insight - Findings For ETFs/ETPs Listed In United States For Q1 2012
April 5, 2012--SUMMARY
At the end of Q1 2012, the US ETF industry had 1,154 ETFs, assets of US$1,077.1 Bn, from 30 providers on 3 exchanges.
In March 2012, 12 new ETFs listed, while 6 ETFs delisted. YTD to Q1 2012, 75 new ETFs have listed, while 14 ETFs have delisted.
In March 2012, ETFs saw net inflows of US$12.4 Bn.
SPDR ETFs gathered the largest net inflows in March with US$4.9 Bn, followed by Vanguard with US$4.8 Bn and PowerShares with US$1.4 Bn net inflows.
Vanguard gathered the largest net inflows YTD with US$17.3 Bn, followed by iShares with US$11.8 Bn and SPDR ETFs with US$7.4 Bn net inflows.
Bank of New York experienced the largest net outflows in March with US$1.2 Bn.
Bank of New York experienced the largest net outflows YTD with US$0.6 Bn, followed by Direxion Shares with US$0.5 Bn and RevenueShares with US$0.01 Bn net outflows.
S&P has the largest amount of ETF assets tracking its benchmarks, with US$312.0 Bn, followed by MSCI with US$284.3 Bn, and Barclays Capital with US$143.1 Bn.
Including other Exchange Traded Products (ETPs), at the end of Q1 2012, the US ETF/ETP industry had 1,438 ETFs/ETPs, assets of US$1,210.5 Bn, from 47 providers on 3 exchanges.
In March 2012, 14 new ETFs/ETPs listed, while 8 ETFs/ETPs delisted. YTD to March 2012, 85 new ETFs/ETPs have listed, while 16 ETFs/ETPs have delisted.
In March 2012, ETFs/ETPs saw net inflows of US$12.8 Bn.
Vanguard gathered the largest net inflows in March with US$4.8 Bn, followed by SPDR ETFs with US$4.6 Bn and PowerShares with US$1.4 Bn net inflows.
Vanguard experienced the largest net inflows YTD with US$17.3 Bn, followed by iShares with US$12.5 Bn and SPDR ETFs with US$9.2 Bn net inflows.
Bank of New York experienced the largest net outflows in March with US$1.2 Bn.
Bank of New York experienced the largest net outflows YTD with US$0.6 Bn, followed by Direxion Shares with US$0.5 Bn and Goldman Sachs with US$0.05 Bn net outflows.
S&P has the largest amount of ETF/ETP assets tracking its benchmarks, with US$318.9 Bn, followed by MSCI with US$284.8 Bn, and Barclays Capital with US$143.5 Bn.
to request more info
Source: Deborah Fuhr, ETF Global Insight LLP
ETF Industry Association Releases March 2012 ETF Data Reports
April 4, 2012--Some of the key highlights from the March 2012 ETF Data report include:
Assets in US listed Exchange Traded Funds (ETF) and Exchange Traded Notes (ETN) totaled approximately $1.21 trillion at March 2012 month-end, an increase of 12% over March 2011 month-end, when assets totaled $1.08 trillion.
ETF/ETN net cash inflows reached approximately $13.2 billion for the month of March 2012, with year-to-date net cash inflows reaching $55.9 billion, a record for the first quarter of a calendar year.
At March 2012 month-end, there were 1,446 U.S. listed products, an increase of 23% compared to 1,173 U.S. listed products at the same time last year.
visit http://www.etf-ia.com/ for more info
Source: ETF Industry Association |
Deutsche Bank - Equity Research - North America:US ETF Market Monthly Review : March inflows of $11.6bn help ETPs reach Q1 inflows record
April 4, 2012--US ETP assets recorded 0.7% MoM and 14.1% YTD growth in March
ETP assets in the US rose by $7.9bn to $1.19 trillion last month, accumulating an increase of 14.1% YTD after the first quarter of the year.
Global ETP industry assets edged higher to $1.63 trillion, or 13.3% up YTD.
Investors are still hungry for risk, but more selective
US ETP flows experienced sturdy inflows of $11.6bn during March, recording the strongest Q1 ever (+$52.0bn, 5.0% of last year’s AUM).
Within long-only ETPs, total flows were +$11.2bn in Mar. vs. +$11.6bn in Feb.
Equity, Fixed Income, and Commodity long-only ETPs experienced cash flows of +$7.5bn, +$4.2bn, and -$0.4bn, respectively.
March was overall a favorable month for risk. However, we observed that the main theme played by market participants was to invest in the safest bets among risk-on trades, signaling a certain degree of concern on their part.
According to long-only ETP flows, investors’ equity preferences in March were: (1) region wise, US (+$5.9bn) over other regions or countries. (2) Within the US, Large Caps (+$6.6bn) over Small Caps (-$2.1bn). (3) Among US Sectors, Domestic Cyclicals (+$1.1bn) over Global Cyclicals (-$0.6bn) and Defensives (+$0.5bn). Within domestic cyclicals, Financials (+$1.6bn) and Technology (+$0.6bn). (4) Style wise, dividend funds (+$1.6bn) were again the way to go. (5) And finally, outside the US, there was still some interest in broad EM (+$1.3bn) and Japan (+$0.6bn) products.
While preferences in the fixed income space were: (1) Credit over Rates, but this time with a tilt towards IG (+$2.2bn) over HY (+$1.0bn). (2) Corporates (+$2.7bn) and Sub-Sovereign (+$0.7bn) (e.g. EM Sov. Debt) over US Sovereign debt (-$0.3bn).
ETFs continued to grow faster than Mutual Funds. At the end of February, ETF inflows ($37bn) contributed 3.9% to the YTD ETF AUM growth; while only 0.9% ($76bn) of the YTD Mutual Fund AUM growth was attributable to new cash.
New Launch Calendar: corporate debt and income generation set the tone
There were 13 new ETPs and 1 new ETN listed during the previous month.
The new product offering was dominated by Fixed Income ETFs with focus mostly on the corporate sector; the following group was represented by Equity products with a tilt towards income-generating investments, and one Commodity ETV with focus in Agriculture.
Floor activity improved, but is still on low levels consistent with volatility
Total monthly turnover increased by 9.3% to $1.31 trillion vs. $1.19 trillion in the previous month.
US ETP trading made up 27.3% of all US cash equity trading in March, down from both its recent peak of 37.5% last August and its 3-year monthly average of 30.3%.
The largest increase was on Equity ETP turnover, which rose by $102bn or 9.9% to $1.13 trillion, followed by Fixed Income products turnover which grew by $7.4bn, totaling $76bn at the end of March. Meanwhile, Commodity ETP turnover rose by $973m to $86bn last month.
to request report
Source: Deutsche Bank-Equity Research-North America
Scottrade's FocusShares Celebrates One-Year Anniversary of Focus Morningstar ETFs
April 3, 2012--FocusShares LLC, an affiliate of online investing services firm Scottrade Inc., today announced the one-year anniversary of its Focus Morningstar exchange-traded funds (ETFs), a family of 15 diverse, low-cost domestic equity ETFs benchmarked to Morningstar Indexes.
During the 12-month period ending March 30, 2012, six Focus Morningstar ETFs had total returns of greater than 10 percent: Focus Morningstar Consumer Cyclical Index ETF (FCL), Focus Morningstar Consumer Defensive Index ETF (FCD), Focus Morningstar Health Care Index ETF (FHC), Focus Morningstar Real Estate Index ETF (FRL), Focus Morningstar Technology Index ETF (FTQ) and Focus Morningstar Utilities Index ETF (FUI). In addition, FLG rose 9.5 percent, compared to 8.5 percent for the S&P 500, while Focus™ Morningstar Mid Cap Index ETF (FMM) increased 3.3 percent, compared to 2 percent for the S&P MidCap 400.
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Source: FocusShares, LLC
Minutes Of The Federal Open Market Committee, March 13, 2012
April 3, 2012--The Federal Reserve Board and the Federal Open Market Committee on Tuesday released the attached minutes of the Committee meeting held on March 13, 2012.
The minutes for each regularly scheduled meeting of the Committee ordinarily are made available three weeks after the day of the policy decision and subsequently are published in the Board's Annual Report. The descriptions of economic and financial conditions contained in these minutes are based solely on the information that was available to the Committee at the time of the meeting.
view the Minutes of the Federal Open Market Committee-March 13, 2012
Source: FBR
iShares Launches New Income Focused ETFs
"First-to-market" funds deliver comprehensive access to global high yield markets, from developed to emerging
April 3, 2012--BlackRock, Inc. (NYSE:BLK - News) announced that its iShares Exchange Traded Funds (ETFs) business, the world's largest manager of ETFs, launched two new funds today with two more scheduled to launch on April 5.
The new funds include three "first to market" products designed to offer exposure to high yield securities across the global developed and emerging markets. The fourth new fund is an “ETF of iShares ETFs” that seeks to provide single-trade access to a diversified set of income sources.
"Market conditions – in particular, an unprecedented low rate environment – continue to make it vital for investors of all kinds to identify new sources of yield and income," said Darek Wojnar, Head of U.S. iShares Product Development and Management at BlackRock. “In many cases, they need ready access to a broader range of global solutions for yield and income.
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Source: BlackRock
Financial Stability Oversight Council Approves Rule To Designate Nonbank Financial Companies For Enhanced Oversight, Help Prevent Future Financial Crises
April 3, 2012--The Financial Stability Oversight Council ("the Council") today took another key step toward increasing oversight and addressing risks to U.S. financial stability by issuing the final rule and guidance that details the analysis and process the Council intends to use when determining which nonbank financial companies should be subject to enhanced prudential standards and to supervision by the Board of Governors of the Federal Reserve System.
This authority is an important component of the Dodd-Frank Wall Street Reform and Consumer Protection Act ("the Dodd-Frank Act") and is one of a number of tools now available to constrain risk and help prevent future financial crises.
With this vote, the Council will begin a three-stage designations process. Secretary Geithner, the chairperson of the Council, has indicated that the Council will work to make the first of these designations this year.
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Source: US Department of the Treasury
