Americas ETP News
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BATS Global Markets Expands Access Of Risk Management And Kill Switch Tools To All Members
Tools Now Available to All Members at No Cost With No Additional Latency Incurred
November 27, 2012--
BATS Global Markets (BATS), a leading operator of securities markets in the U.S. and Europe, today rolled out a suite of risk management tools available at no charge to all members of its U.S. equities and equity option markets to help them mitigate risk.
Beginning today the tools are available to all members of the BATS BZX Exchange, BYX Exchange and BATS Options at no charge with no additional latency incurred on inbound orders to BATS.
The customizable port-level risk management tools, which had previously only been available to Sponsoring Members, provide members with pre-trade risk protection by enabling members to set critical parameters for orders and prevent unwanted executions. Some of the key features of the risk management tools include the ability to set order restrictions, maximum per-order limits, and order cutoffs, or a member controlled "kill switch," which would cancel all open orders and block new orders.
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Source: BATS Global Markets, Inc.
Knight Capital Group Sale Rumors: What is the Company Worth?
November 26, 2012--After rumors started this past weekend of a potential sale, shares of Knight Capital Group Inc. (NYSE:KCG) are actively trading on Monday.
As of 3:00 p.m. ET, the stock is up 18.07 percent, trading at $2.94.
On Saturday, the Wall Street Journal reported that the firm was holding talks to potentially sell its large and profitable market-making operation.
From 2009 to 2011, the unit had pretax profits of $663.8 million, but in 2012′s first nine months, it incurred a $400.9 million loss due to a software glitch that resulted in erroneous trades back on Aug. 1.
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Source: Investing Channel
ProShares Considers Listing Products with BATS
November 26, 2012--On January 24th, BATS Global Markets became the third listing venue for U.S. exchange-traded products when the iShares unit of BlackRock launched the first of sixteen new funds on the BATS BZX Exchange.
Several of those new funds even debuted after BATS self-listed initial public offered stumbled in March.
Now Bethesda, Md.-based ProShares Advisors is looking to become the second ETP issuer to take the BATS challenge.
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Source: Forbes
Nuveen Hires Former BlackRock Strategist Robert Doll
November 26, 2012--Nuveen Asset Management hired Robert Doll as chief equity strategist, less than six months after he announced his retirement from the same role at BlackRock Inc. (BLK), where he was known for his bullish stance on stocks.
Doll, 58, will also serve as senior portfolio manager directly overseeing about $1.5 billion and reporting to David A. Chalupnik, Nuveen’s head of
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Source: Bloomberg
ISE is First Exchange to Announce Mini Options Launch on March 18
November 26, 2012--The International Securities Exchange (ISE) today became the first exchange to confirm a launch date of March 18, 2013 to commence trading in Mini Options.
Since receiving Securities and Exchange Commission (SEC) approval for this innovative new product offering, ISE has been coordinating with its member firms to determine an appropriate date for launch readiness. Mini Options will represent a deliverable of 10 shares of an underlying security, whereas standard contracts represent a deliverable of 100 shares. ISE will initially list Mini Options on the following securities: AAPL, AMZN, GLD, GOOG, and SPY.
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Source: International Securities Exchange
SEC Chairman Mary Schapiro to Step Down Next Month
November 26, 2012--After nearly four years in office, SEC Chairman Mary L. Schapiro today announced that she will step down on Dec. 14, 2012.
Chairman Schapiro, who became chairman in the wake of the financial crisis in January 2009, strengthened, reformed, and revitalized the agency. She oversaw a more rigorous enforcement and examination program, and shaped new rules by which Wall Street must play.
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Source: SEC.gov
Schapiro stepping down at SEC, Walter to step in
November 26, 2012--The head of the U.S. Securities and Exchange Commission, Mary Schapiro, will step down next month after a tumultuous four years spent rehabilitating the agency's battered reputation, handing the reins at least temporarily to a close ally.
"We've gotten a lot done, I'm really proud of where the agency is today, so it seemed like a good time," Schapiro said in an interview on Monday after announcing her departure.
SEC Commissioner Elisse Walter, a career regulator who has sided with Schapiro on most of the critical issues before the agency, will serve as chairman-designate, the White House said.
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Source: Reuters
DB-Synthetic Equity & Index Strategy-North America-US ETF Weekly Review-Equity inflows and market rally push ETP Assets up by 2.9%
November 26, 2012--Market and Net Cash Flows Review
Markets experienced a good relief rally during the shorter Thanksgiving week. The US (S&P 500) soared by 3.62%; while, outside the US, the MSCI EAFE (in USD) and the MSCI EM (USD) rose by 4.81% and 2.70%, respectively.
Moving on to other asset classes, credit outperformed rates; while commodities ended higher across the board with the DB Liquid Commodity Index up by 2.02%, and Silver prices moving up by 5.45%. In the meantime, Volatility (VIX) dropped by 7.74% during the same period.
The total US ETP flows from all products registered $4.6bn (+0.4% of AUM) of inflows during last week vs. $6.71bn (-0.5%) of outflows the previous week, setting the YTD weekly flows average at +$2.9bn (+$136.15bn or +13.0% YTD in total cash flows).
Equity, Fixed Income, and Commodity ETPs experienced flows of +$3.27bn (+0.4%), +$1.31bn (+0.5%), -$0.02bn (-0.0%) last week vs. -$6.68bn (-0.8%), -$0.13bn (-0.1%), +$0.06bn (+0.1%) in the previous week, respectively.
Among US sectors, Materials (+$0.72bn, +7.95%) and Consumer Discretionary (+$0.28bn, +5.00%) received the top inflows, while Utilities (-$0.55bn, -7.36%) and Financials (-$0.39bn, -0.91%) experienced the largest outflows.
Within Equity ETPs, Large Cap products had the largest inflows (+$2.3bn, +1.2%); while US Sector products had the largest outflows of $0.5bn (-0.4%). Within Fixed Income ETPs, Corporate products had the largest inflows (+$0.7bn, +0.7%).
Top 3 ETPs & ETNs by inflows: SPY (+$2.3bn), EEM (+$0.6bn), IWM (+$0.6bn)
Top 3 ETPs & ETNs by outflows: XLU (-$0.5bn), XLF (-$0.3bn), MDY (-$0.2bn)
New Launch Calendar: no new listings
There were no new listings during last week
Turnover Review: Floor activity decreased by 44% on shorter week
Mostly driven by the shorter Thanksgiving week, total weekly turnover decreased by 43.8% to $171bn vs. $304bn from the previous week. Last week's turnover level was 55% below last year's weekly average. Equity, Fixed Income and Commodity ETPs turnover decreased by $120.9bn (-44.5%), $6.4bn (-38.0%) and $4.3bn (-35.0%), respectively.
Assets under Management (AUM) Review: ETP assets rose by 2.9%
Markets boosted assets by $36bn last week. As of last Friday, US ETPs have accumulated an asset growth of 21.7% YTD. Assets for equity, fixed income and commodity ETPs moved +$33.3bn, +$1.3bn, +$1.9bn during last week, respectively.
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Source: Deutsche Bank -Synthetic Equity & Index Strategy -North America
Legg Mason Wins Approval to Launch Actively Managed ETFs
Van Eck draws up plans for a hedged junk-bond ETF, and Barclays pulls the plug on a volatility ETN.
November 26, 2012--On Friday, Nov. 16, Legg Mason won permission from the SEC to be able to launch actively managed exchange-traded funds.
The announcement paves the way for Legg Mason to move forward with some or all of the three actively managed funds that it presently has in registration with the SEC. Indeed, the firm of late has been updating its filings for three proposed actively managed ETFs--one of which would be an ultra-short duration bond fund, and two of which would be equity ETFs.
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Source: Morningstar
Morgan Stanley--ETF Weekly Update
November 26, 2012--US ETF Weekly Update
Weekly Flows: $4.6 Billion Net Inflows
ETF Assets Stand at $1.3 Trillion, up 22% YTD
No ETF Launches Last Week
Belgium ETF Undergoes Changes
November 26, 2012--US-Listed ETFs: Estimated Flows by Market Segment
Amid positive equity market returns, ETF flows rebounded last week, posting net inflows of $4.6 bln
Net inflows were led by US Large-Cap ETFs, specifically the SPDR S&P 500 ETF (SPY); US Large-Cap ETFs posted net
inflows of $2.1 bln last week and SPY had net inflows of $2.3 bln
ETF assets stand at $1.3 tln (up 22% YTD) and have posted net inflows 36 out of 47 weeks in 2012 ($134.9 bln YTD)
13-week flows were mostly positive among asset classes; combined $44.4 bln net inflows
Fixed Income ETFs have posted net inflows 64 out of the past 67 weeks; including $11.8 bln over the past 13 weeks
International Equity ETFs (Emerging and Developed Markets) have exhibited a combined $16.4 bln in net inflows over the last 13 weeks
US-Listed ETFs: Estimated Largest Flows by Individual ETF
SPDR S&P 500 ETF (SPY) generated net inflows of $2.3 bln, the most of any ETF
US Equity ETFs accounted for seven out of the 10 ETFs to post the largest net inflows and eight of the 10 to post the greatest net outflows (10 of 10 if inverse ETFs included)
Over the last 13 weeks, the iShares MSCI Emerging Markets Index Fund (EEM) posted net inflows of $3.7 bln, the most of any ETF
Since Vanguard announced on 10/2/12 plans to change its benchmark on the Vanguard MSCI Emerging Markets ETF (VWO),EEM has posted net inflows of $2.8 bln whereas VWO has exhibited net outflows of $1.0 bln
US-Listed ETFs: Short Interest
Data Unchanged: Based on data as of 10/31/12
SPDR S&P 500 ETF (SPY) had the largest increase in USD short interest at $1.9 bln
Despite an increase in short interest last period, SPY’s shares short remained 26% below their average level over the past year
Aggregate ETF USD short interest increased by $3.9 bln over the past two weeks ended 10/31/12
The average shares short/shares outstanding for ETFs is currently 4.4%
Smaller ETFs by market cap may skew the results (3 of the top 10 with the highest % of shares short have market caps <$25 mln)
Notably, the iShares Barclays 20+ Year Treasury Bond Fund (TLT) cracked the top 10 most heavily shorted ETFs
Based on multiple borrowings and the ability to continuously create new shares, shares short as a % of shares outstanding can exceed 100% (only seven ETFs exhibited shares short as a % of shares outstanding greater than 100%)
US-Listed ETFs: Most Successful Recent Launches by Assets
Source: Bloomberg, Morgan Stanley Smith Barney Research.
Data estimated as of 11/23/12 based on daily change in share counts and daily NAVs.
$7.8 billion in total market cap of ETFs less than 1-year old
Newly launched Active ETFs account for 53% of the market cap of ETFs launched over the past year; PIMCO Total Return ETF (BOND) is the largest actively managed ETF with a market cap of $3.7 bln
142 new ETF listings and 76 closures YTD (additional 3 liquidations have been announced)
The top 10 most successful launches make up 72% of the market cap of ETFs launched over the past year
Five different ETF sponsors and two asset classes represented in top 10 most successful launches
Interestingly, the iShares Core MSCI Emerging Markets ETF (IEMG), part of a series of recently launched low-cost, retailfocused ETFs by iShares, has accumulated $117 mln in assets in a month; IEMG does not have the liquidity of other Emerging Markets ETFs; however, with an expense ratio of 18 bps, it is one of the lowest cost products in the space
