Americas ETP News
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US downgrade worries hang over Treasuries
June 27, 2011--A new study looks into what could happen if America loses its triple A rating as a result of Republicans and Democrats failing to strike a deal on the debt ceiling.
Judging by the very low levels of Treasury bond yields, which move inversely to bond price, investors for now appear sanguine about the risk that the US could lose its coveted triple A rating.
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Source: FT.com
Dollar seen losing global reserve status
June 27, 2011--The US dollar will lose its status as the global reserve currency over the next 25 years, according to a survey of central bank reserve managers who collectively control more than $8,000bn.
More than half the managers, who were polled by UBS, predicted that the dollar would be replaced by a portfolio of currencies within the next 25 years.
That marks a departure from previous years, when the central bank reserve managers have said the dollar would retain its status as the sole reserve currency.
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Source: FT.com
Pennsylvania Securities Commission Cautions Retail Investors about Exchange-Traded Funds
Certain ETFs May Not be Appropriate for Long-term Investors
June 27, 2011-- Exchange-traded funds (ETFs) have grown increasingly popular with retail investors during the last decade. Securities regulators are concerned that investors may not understand how these complex investment products work or the potential risks they may face.
The Pennsylvania Securities Commission (PSC) today cautioned investors to make sure they understand ETFs before they invest and consider whether these investments are right for them. The PSC's ETF advisory is available at www.psc.state.pa.us.
"As with any investment, investors should know what they are investing in. They should understand the risks, costs and tax consequences before investing in ETFs. Check under the hood," said Chairman Robert Lam.
Exchange-traded funds are baskets of investments such as stocks, bonds, commodities, currencies, options, swaps, futures contracts and other derivative instruments that are created to mimic the performance of an underlying index or sector.
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Source: Pennsylvania Securities Commission
BlackRock Readies Colombia Index ETF in South America Expansion
June 27, 2011--BlackRock Inc. is preparing to start a local exchange-traded fund in Colombia as the world’s largest money manager expands its operations in South America.
The fund will be denominated in Colombian pesos and will track the Colcap Index, said Axel Christensen, BlackRock’s managing director for South America excluding Brazil.
“We’re very close to starting a product in Colombia,” he said in an interview from London during a Chilean investment promotion event. “We are days away, we hope.”
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Source: Bloomberg
Brinker Capital Introduces ETFs to Defined Contribution
June 27, 2011--Brinker Capital, a leading autonomous investment management firm, announced this day the addition of 7 exchange-bought or sold fund (ETF) strategies to its Outlined Contribution retirement plan offering. The move supplies plan partakers with extra means of attaining their
economical objectives by capitalizing on the great things about active, over and above passive, portfolio management.
“In Contempt Of that fame, very few retirement plan executives have works out a way to include ETFs in 401(k) plans due to buying or selling complications. After years of study and a tech make-out, we’re satisfied to be
offering these investment cars in our Outlined Contribution plans.”
Brinker Capital is assisting forge new area in the retirement plan space as it is one of the first fiduciaries to take that reasonably priced managed solution to market.
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Source: Solutions for retirement
First Trust files with the SEC
June 27, 2011--First Trust has filed a post-effective amendment, registration statement with the SEC for the First Trust ISE Cloud Computing Index Fund
Ticker Symbol: SKYY
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Source: SEC.gov
Morgan Stanley-US ETF Weekly Update
June 27, 2011--Weekly Flows: $1.8 Billion Net Outflows
Launches: 12 New ETFs
Emerging Global Makes Name and Ticker Changes
Invesco PowerShares to Liquidate Two ETFs
US-Listed ETFs: Estimated Flows by Market Segment
ETFs exhibited net outflows of $1.8 billion last week
M
US Large-Cap ETFs posted the largest net outflows last week, primarily driven by SPDR S&P 500 ETF (SPY)
ETF assets stand at $1.1 trillion, up 5% YTD; we estimate all from net new money
13-week flows remained mostly positive among asset classes
$32.2 billion net inflows into ETFs over past 13 weeks (Fixed Income up $9.3 bln; Commodity down $3.1 bln)
We estimate ETFs have generated net inflows 15 out of 25 weeks YTD; ETFs have exhibited net outflows 5 out
of last 8 weeks
US-Listed ETFs: Estimated Largest Flows by Individual ETF
Vanguard MSCI EM ETF (VWO) generated net inflows of $1.1 billion last week, most of any ETF
SPDR S&P 500 ETF (SPY) posted the largest net outflows last week ($6.4 billion net outflows); however, it
has exhibited net inflows of $3.6 billion over the past 13 weeks, the most of any ETF
Despite ETFs posting net outflows as a whole, only 16% (183 ETFs) actually exhibited net outflows last week
US-Listed ETFs: Change in Short Interest
Data Updated: Based on data as of 6/15/11
SPY exhibited the largest increase in USD short interest since last updated
Roughly $5.2 billion in additional short interest
Highest level of shares short in history for SPY
XRT exhibited the largest decline in USD short interest since last updated
Roughly $761 million in reduced short interest
Lowest level of shares short for XRT since 3/31/11
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Source: Morgan Stanley
CFTC.gov Commitments of Traders Reports Update
June 24, 2011--The current reports for the week of June 21, 2011 are now available.
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Source: CFTC.gov
Fitch Ratings-Liquidity and Covenant Analysis for Large U.S. Leveraged Issuers
June 24, 2011--Credit Improvement Plateaus as Issuers Focus on Refinancing
Liquidity and Free Cash Flow Remain Strong: In aggregate, near-term liquidity remains ample as 71% (22 in total) of the issuers studied have more than a combined $1 billion in cash
and revolver availability. The number of issuers with negative FCF on an LTM basis was unchanged from the last period at 19%.
As in previous periods, companies continue to use cash,
in addition to FCF, for strategic opportunities, acquisitions, dividends, debt repayment, and recently for share repurchases. Cash levels-although still robust -trended lower for 18 of the 31 issuers studied, compared to the previous period.
Covenant Cushions Tighten: Covenant cushions contracted for 19% of the issuers (six in total) from Dec. 31, 2010 to March 31, 2010, by an average of 2.8%. Nonetheless, covenant headroom remains adequate for most of the issuers studied. Only two issuers experienced a covenant stepdown during the period, while one issuer experienced a loosening of its covenant. Eight companies (down from nine in the last report) are in a position where a 20% (or less) decline in EBITDA would trip their tightest covenant. MGM International continues to have the tightest covenant cushion at 10%.
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Source: Fitch Ratings
Maple Group Receives Endorsement From Stephen Jarislowsky
June 24, 2011--Maple Group Acquisition Corporation ("Maple"), a corporation whose investors comprise 13 of Canada's leading financial institutions and pension funds, released a statement it received from Stephen Jarislowsky, Chairman, C.E.O. and Director of Jarislowsky Fraser Limited.
We can grow internationally
The London Stock Exchange is promising to take the TMX and its companies into the international arena. With all due respect for our friends in London, Canada and its financial community do not need their assistance to ensure their development on the international scene.
How can the fact of wanting to develop one's own stock exchange be construed as evidence of an introverted or protectionist attitude? Does it mean we should remain silent and let our companies and institutions leave even if we firmly believe we are in the best position to help them grow--locally as well as internationally--for the benefit of our country? The TMX's takeover by the London Stock Exchange will result in a weakening of Canada's financial community. We are at risk of seeing an exodus of our financial institutions and our brightest financial talents.
Source: Maple Group Acquisition Corporation
