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SEC Adopts Rules to Permit Crowdfunding
October 30, 2015-The Securities and Exchange Commission today adopted final rules to permit companies to offer and sell securities through crowdfunding.
The Commission also voted to propose amendments to existing Securities Act rules to facilitate intrastate and regional securities offerings. The new rules and proposed amendments are designed to assist smaller companies with capital formation and provide investors with additional protections.
Crowdfunding is an evolving method of raising capital that has been used to raise funds through the Internet for a variety of projects. Title III of the JOBS Act created a federal exemption under the securities laws so that this type of funding method can be used to offer and sell securities.
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Source: SEC.gov
Morgan Stanley-US ETF Weekly Update
October 26, 2015--Weekly Flows: $9.4 Billion Net Inflows
Third Consecutive Week of Net Inflows, Totaling $32.2 Billion
High-conviction ETF Recommendations Slide: No Changes
ETF Assets Stand at $2.1 Trillion, up 7% YTD
Four ETF Launches Last Week
Van Eck Announces Partnership with Merk
Direxion Closes Three ETFs
US-Listed ETFs: Estimated Flows by Market Segment
ETFs posted net inflows of $9.4 bln last week; third consecutive week of net inflows, totaling $32.2 bln
Last week's net inflows were led by Fixed Income ETFs at $2.9 bln; conversely, Global ETFs posted modest net outflows of $242 mln, the most of any category we measured
Twelve of the 15 categories we measured posted net inflows last week
ETFs have generated net inflows 30 of 43 weeks YTD
ETF assets stand at $2.1 tln, up 7% YTD
13-week flows remain positive among most asset classes; combined $47.3 bln in net inflows
Fixed Income ETFs generated net inflows of $25.7 bln over the last 13 weeks, the most of any category we measured and meaningfully higher than the next largest category, US Large-Cap ETFs, which had $10.4 bln in net inflows - International
Emerging ETFs have exhibited net outflows of $5.2 bln over the last 13 weeks, but have shown some recent stabilization
Interestingly, US Sector & Industry ETFs have posted net outflows of $2.5 bln over the last 13 weeks; however, over the last 4 weeks, it appears the tide has turned with the category generating $3.7 bln in net inflows
US-Listed ETFs: Estimated Largest Flows by Individual ETF
PowerShares QQQ (QQQ) posted net inflows of $1.1 bln last week, leading all ETFs
The iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD) had another solid week, posting $910 mln in net inflows; over the last 13 weeks LQD has exhibited net inflows of $2.8 bln
In addition to the largest investment grade corporate bond fund, LQD, generating strong flows, the iShares iBoxx $ High Yield Corporate Bond ETF (HYG) and SPDR Barclays High Yield Bond ETF (JNK), the two largest high yield bond ETFs, had a combined $1.5 bln in net inflows last week and $3.1 bln over the last 13 weeks
Two widely followed broad emerging market equity ETFs, the iShares MSCI Emerging Markets ETF (EEM) and iShares Core MSCI Emerging Markets ETF (IEMG) had a combined $927 mln in net inflows last week
Conversely, three US Treasury-based ETFs, the iShares Short Treasury Bond ETF (SHV), iShares 7-10 Year Treasury Bond ETF (IEF), and iShares 3-7 Year Treasury Bond ETF (IEI), had a combined $1.3 bln in net outflows last week
US-Listed ETFs: ETF Dollar Volume
ETF monthly $ volume as a % of listed trading volume was down slightly in September to 29% relative to August’s 30% reading; over the last five years, ETF monthly $ volume as a % of listed trading volume averaged 27%
Over the last five years, ETF monthly $ volume as a % of listed trading volume peaked in August 2011 at 36%
ETF $ volume was up $24 bln last week compared to the prior week but is 16% below its 13-week average
US Sector & Industry ETF volume accounted for 16% of ETF $ volume last week compared to its 13-week average of 14% and its 12% market cap share
US-Listed ETFs: Short Interest Data Unchanged: Based on data as of 9/30/15
iShares Nasdaq Biotechnology ETF (IBB) had the largest increase in USD short interest at $671 mln
IBB's shares short at 12 mln are at their highest level since 9/15/08
On the other hand, the SPDR S&P 500 ETF (SPY) had the biggest decline in USD short interest last period at $12.5 bln; despite the decline, SPY's shares short are still 30% above their 52-week average
644 ETFs exhibited short interest increases while 733 experienced short interest declines over the last period
Aggregate ETF USD short interest decreased by $16.9 bln over the period ended 9/30/15
The average shares short/shares outstanding for ETFs is currently 3.7%, down from 3.8% last period
For the eighth consecutive period the Market Vectors Semiconductor ETF (SMH) occupied the top spot as the most heavily shorted ETF as a % of shares outstanding at 636%
Eight of the 10 most heavily shorted ETFs as a % of shares outstanding are industry based (SMH, XRT, XBI, IYR, SOXX, DRV, XME, XOP)
Based on multiple borrowings and the ability to continuously create new shares, shares short as a % of shares outstanding can exceed 100% (only five ETFs exhibited shares short as a % of shares outstanding greater than or equal to 100%)
US-Listed ETFs: Most Successful Recent Launches by Assets
$8.2 bln in total market cap of ETFs less than 1-year old
Over the last 13 weeks, recently launched Active ETFs generated net inflows of $604 mln, more than any other category; Active ETFs account for 25% of recently launched market share, trailing only Global ETFs
Notably, 63 International - Developed ETFs were launched over the last year as ETF sponsors have issued products in an area that has exhibited strong net inflows this year
223 new ETF listings and 75 closures YTD
The top 10 most successful launches make up 55% of the market cap of ETFs launched over the past year
Nine ETF sponsors and two asset classes (equity and fixed income) were represented in top 10 most successful launches; nine different ETF sponsors is one of the most diverse groups of issuers we've experienced since publishing this exhibit
The SPDR DoubleLine Total Return Tactical ETF (TOTL) had another positive week of flows at $30 mln; TOTL is an actively managed fixed income ETF sub-advised by DoubleLine and is the most successful launch, as measured by market cap, over the last year.
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Source: Morgan Stanley
Van Eck Global and Merk Investments Announce Marketing Agreement
Merk's physical gold ETF will be marketed by Van Eck, rebranded as Van Eck Merk Gold Trust
October 26, 2015--Van Eck Global and Merk Investments LLC are today announcing that Van Eck has begun to act as marketing agent for the Van Eck Merk Gold Trust (NYSE Arca: OUNZ), previously known as the Merk Gold Trust.
OUNZ, launched by Merk President & CIO Axel Merk and his team, seeks to provide investors with a convenient and cost-efficient way to buy and hold gold through an exchange-traded fund (ETF) while also giving investors the option to take physical delivery of gold if and when desired. While other exchange-traded products provide investors with exposure to gold, OUNZ is the only that provides a patented, physical gold delivery option.
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Source: Van Eck
BNY Mellon's Pershing's Report Uncovers What Advisors Need to be Aware of When Assessing the True Cost of ETF Ownership
Advisors are familiar with the benefits ETFs offer, but more complex issues lie just below the surface
Many of the well-known benefits of exchange traded funds (ETFs), including diversification, lower costs, flexibility and tax efficiency, tend to overshadow the complex features and pricing of these products, according to a whitepaper released today by Pershing LLC., a BNY Mellon company.
The report, What Lies Beneath: Understanding the Structure and Costs in ETFs, outlines underlying components that impact ETF pricing, and identifies areas that advisors should keep in mind when evaluating the true cost of ETF ownership for their clients.
view the What Lies Beneath: Understanding the Structure and Costs in ETFs white paper
Source: BNY Mellon
Deutsche Bank-United States-Synthetic Equity & Index Strategy-US ETF Market Weekly Review
Markets and $9.4bn inflows push ETP
assets up by 1.5%
October 26, 2015--Data in this report is as of Friday, October 23th
Market and Net Cash Flows Review
The US (S&P 500) edged higher by 2.07%; while, outside the US, the MSCI EAFE (in USD) and the MSCI EM (USD) rose by 0.83% and 0.39%, respectively. In the meantime, performance was mostly positive across US sectors. The Technology (+4.27%) and the Industrials (+3.92%) recorded the largest increases; while, Energy (-1.33%) and Healthcare (-0.73%) were the worst performing sectors. The DB Liquid Commodity Index fell by 2.62%; similarly, the Agriculture sector (DB Diversified Agriculture Index), the WTI Crude Oil, Gold, and Silver prices fell by 0.53%, 5.63%, 1.08% and 1.47%, respectively.
Moving into other asset classes, the 10Y US Treasury Yield increased by 5bps ending at 2.09%. Last but not least, Volatility (VIX) dropped by 3.92% during the same period.
The total US ETP flows from all products registered $9.4bn (+0.5% of AUM) of inflows during last week vs. $5.8bn (+0.3%) of inflows the previous week, setting the YTD weekly flows average at +$4.0bn (+$170.4bn YTD in total cash flows). Equity, Fixed Income, and Commodity ETPs experienced flows of +$6.1bn (+0.4%), +$3.0bn (+0.8%), and +$0.3bn (+0.5%) last week vs. +$5.0bn (+0.3%), +$0.5bn (+0.2%), and +$0.3bn (+0.6%) in the previous week, respectively. Among US sectors, all of them experienced positive flows, Financials (+$0.7bn, +0.9%) and Consumer Staples (+$0.5bn, +3.2%) received the top inflows.
Top 3 ETPs & ETNs by inflows: QQQ (+$1.1bn), LQD (+$0.9bn), HYG (+$0.8bn)
Top 3 ETPs & ETNs by outflows: SPY (-$1.8bn), SHV (-$0.5bn), IEF (-$0.4bn)
New Launch Calendar: FX hedged China A-Shares, China A- and H-Shares, US Large Cap High Dividend
There were four new ETFs listed during the last week. Two of the four new products offer the first FX hedged exposure to the China A-share market; while, the remaining two funds offer exposure to China A and H-Shares market using a dynamic share class arbitrage strategy, and high dividend yielding stocks in the S&P 500 Index.
Turnover Review: Floor activity increased by 8.5%
Total weekly turnover increased by 8.5% to $355.3bn vs. $327.6bn from the previous week. Furthermore, last week's turnover level was 10.4% over last year's weekly average. Equity and Fixed Income ETPs turnover increased by $25.3bn (+8.7%) and $5.6bn (+24.6%), respectively; while, Commodity ETPs turnover decreased by $3.4bn (-35.9%) during the same period.
Asset under Management (AUM) Review: Assets increased by $31.4bn
US ETP assets rose by $31.4bn (+1.5%) totaling $2.114 trillion at the end of the week. As of last Friday, US ETPs had accumulated an asset growth of +6.8% YTD. Assets for Equity, Fixed Income, and Commodity ETPs moved +$29.1bn, +$3.0bn, and -$0.8bn during last week, respectively.
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Source: Deutsche Bank-Synthetic Equity & Index Strategy-Markets Research-North America-United States-US ETF Market
First Asset Announces Acquisition by CI Financial Corp.
October 23, 2015-As announced earlier today by CI Financial Corp. ("CI Financial"), First Asset Capital Corp. ("First Asset") confirmed today that it has agreed to be acquired by CI Financial.
The transaction will result in a change of control of First Asset Investment Management Inc., the investment manager of the Funds listed below.
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Source: First Asset
First Asset Announces Acquisition by CI Financial Corp.
October 23, 2015--As announced earlier today by CI Financial Corp. ("CI Financial"), First Asset Capital Corp. ("First Asset") confirmed today that it has agreed to be acquired by CI Financial.
The transaction will result in a change of control of First Asset Investment Management Inc., the investment manager of the Funds listed below.
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Source: First Asset
Infographic-The U.S. Debt Ceiling has Risen No Matter Who is in Office
October 23, 2015--This chart shows the history of the U.S. debt ceiling from 1970 until today, including the current proposal to increase it to $19.6 trillion.
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Source: visualcapitalist.com
State Street Global Advisors Expands SPDR ETF Equity Income Suite
SPYD Offers Investors Exposure to Dividend Paying Stocks in the S&P 500
October 22, 2015--State Street Global Advisors (SSGA), the asset management business of State Street Corporation (NYSE:STT), today announced that the SPDR S&P 500 High Dividend ETF (SPYD) began trading on the NYSE Arca.
Providing access to a portfolio comprised of the 80 highest dividend paying stocks in the S&P 500 Index, SPYD is designed for investors seeking both equity income and the potential for capital appreciation at a relatively low gross expense ratio of 0.12 percent.
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Source: State Street Corporation
SEC Announces Enforcement Results For FY 2015
Results Include Significant Number of High-Impact and First-of-their-Kind Actions
October 22, 2015--The Securities and Exchange Commission today announced that in fiscal year 2015, it continued to build a strong record of first-of--heir-kind cases that spanned the spectrum of the securities industry.
In the fiscal year that ended in September, the SEC filed 807 enforcement actions covering a wide range of misconduct, and obtained orders totaling approximately $4.2 billion in disgorgement and penalties.
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Source: SEC.gov
