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After Knight, Unfair Knocks
August 7, 2012--ETF liquidity, electronic trading and rogue algorithms all came under renewed scrutiny in the wake of the Knight Capital debacle. But the pundits got it wrong: The ETF market is liquid and sound.
The recent event at Knight Capital, which was in reality nothing more than a technology glitch, once again gave various media outlets and talking heads an excuse to theorize about issues of liquidity in ETFs and the effects of electronic trading in our market place.
Knight Capital Group Notice Regarding Capital Infusion Transaction And Reliance On Exemption To NYSE's Shareholder Approval Policy view more BM&FBOVESPA-Institutional investors lead participation in volume of index funds (ETFs) traded on the Exchange in July view the Click here to access the July Bulletin on ETF activities. Previous months are also available NYSE Euronext Temporarily Re-assigns Knight Capital DMM Responsibilities to GETCO DMM for Certain Securities
Exchange rules permit the temporary reallocation of any security whenever the Exchange believes such reallocation would be in the public interest. Upon Knight Capital Group, Inc.'s completion and approval of a recapitalization plan, all temporarily reassigned NYSE and NYSE MKT securities as well as DMM staff, operations and systems oversight will be returned to Knight Capital Americas in a timely manner.
"We believe this interim transition is in the best interests of investors, our listed issuers, market stability and efficiency, as well as Knight, as the firm finalizes its equity financing transaction," said Larry Leibowitz, Chief Operating Officer, NYSE Euronext. read more Knight Capital Group Completes $400 Million Equity Financing Agreement Infusion of new capital and resulting liquidity will allow Knight to resume normal operations immediately view more
CFTC.gov Financial Data for Futures Commission Merchants Update As Knight Capital Gains a Lifeline, It Loses Market-Making Duties read more
ETFs Poised to Exceed Trade in S&P 500 as Spiders Beat Apple read more
FocusShares Trust's Board of Trustees Votes to Close Exchange Traded Funds read more
Statement from Russell on U.S. ETF business
Russell remains the underlying Index provider for many ETFs around the world, with more than $80 billion in assets under management¹, and will continue its strong partnership with each of these ETF sponsors.
The firm will announce additional details once the strategic review is completed.
Source: Wealth Management.com
August 6, 2012--Knight Capital Group, Inc. (NYSE Euronext: KCG) today announced that it has issued shares of convertible preferred stock convertible into approximately 267 million shares of common stock pursuant to a Securities Purchase Agreement entered into by Knight with several purchasers on August 6, 2012 in exchange for an aggregate of $400 million.
This capital infusion was undertaken in response to the extraordinary trading loss experienced by Knight on August 1, 2012, which significantly depleted Knight's capital base and in turn precipitated a loss of customer and counterparty confidence and liquidity crisis that, if not immediately addressed, would have threatened Knight's ability to continue to operate. Today's capital infusion provides the liquidity and capital necessary to restore confidence to customers and the market and enables Knight to continue as an active participant in the capital markets. Because the shares issued represent, on an as-converted basis, approximately 73% of the outstanding common stock of Knight on a post-issuance basis, the issuance of convertible preferred stock would normally have required approval of Knight's stockholders according to the Shareholder Approval Policy of the New York Stock Exchange (the "Exchange").
Source: Knight Capital Group
August 6, 2012--Institutional investors led with a 35.5% participation of the total volume of index funds (ETFs) traded on the Exchange in July, followed by foreign investors (24.2%), financial institutions (22.6%), individuals (14.5%) and public and private companies (3.2%).
In July, shares of the iShares Ibovespa Index Fund were the most traded on BM&FBOVESPA. The BOVA11 ticker accounted for 89.6% of total volume of ETFs traded on the Exchange.
Source: BM&FBOVESPA
NYSE Euronext Temporarily Re-assigns Knight Capital DMM Responsibilities to GETCO DMM for Certain Securities
Working in cooperation with both firms, interim transfer ensures orderly markets while Knight Capital completes anticipated recapitalization plan
August 6, 2012--In accordance with applicable rules, the New York Stock Exchange (NYSE) and NYSE MKT have temporarily assigned custodial responsibility for approximately 524 New York Stock Exchange (NYSE) and 156 NYSE MKT listed securities from the Designated Market Maker (DMM) unit of Knight Capital Americas LLC to the DMM of GETCO LLC,
which currently serves some 896 NYSE- and NYSE MKT-assigned securities, effective Monday, Aug. 6, 2012.
Source: NYSE Euronext
August 6, 2012--Knight Capital Group, Inc. (NYSE Euronext: KCG) announced $400 million in equity financing with Wall Street firms including Jefferies Group, Inc., which conceived and structured the investment, as well as Blackstone, GETCO LLC, Stephens, Stifel Financial Corp. and TD Ameritrade Holding Corporation.
"We are grateful for the support of these leading Wall Street firms that came together to invest in Knight," said Tom Joyce, Chairman and Chief Executive Officer, Knight Capital Group. "The array of participants in this capital infusion underscores Knight's critical role in the capital markets. With our financial position strengthened and liquidity restored, we will continue to provide clients with trading in a broad range of securities, high-quality execution and outstanding client service."
Source: Knight Capital Group
August 6, 2012--Selected FCM financial data as of June 30, 2012 (from reports filed by August 1, 2012) is now available.
view updates
Source: CFTC.gov
August 6, 2012--The Knight Capital Group confirmed on Monday that it had struck a $400 million rescue deal with a group of investors, staving off collapse after a recent trading mishap, even as the New York Stock Exchange temporarily revoked the firm's market-making responsibilities.
The rescue package, which was arranged by the Jefferies Group, includes investments from TD Ameritrade and the Blackstone Group. Getco and Stifel, Nicolaus & Company were also involved.
Source: New York Times
August 6, 2012--For the first time, the value of transactions in exchange-traded funds tracking the Standard & Poor's 500 Index (SPX) is poised to exceed the turnover for all the stocks in the benchmark gauge of American equity.
Dollar volume in the SPDR S&P 500 ETF Trust, the iShares S&P 500 Fund and the Vanguard S&P 500 ETF reached a 12-month average of $28 billion a day last month, 98 percent of the trading in the index’s companies, which include Apple Inc. (AAPL) and Exxon Mobil Corp., data compiled by Bloomberg and Goldman Sachs Group Inc. (GS) show. Investors have flocked to the securities that mimic benchmark returns after the financial crisis increased swings and correlations between assets.
Source: Bloomberg
August 6, 2012--FocusShares, LLC ("Advisor"), a registered investment adviser, announced today that the Board of Trustees of the FocusShares Trust ("Trust"), in consultation with the Advisor, determined to discontinue and liquidate the FocusShares family of exchange traded funds ("Funds") as of August 30, 2012.
The 15 Funds had approximately $100 million in aggregate assets as of July 31, 2012. The Funds were launched in March 2011 and are designed to track broad equity market and sector-specific Morningstar benchmark indexes.
Source: FocusShares, LLC
August 6, 2012-Russell Investments announced today that it is conducting a strategic review of its direct U.S. ETF business in an effort to focus more exclusively on its core competency-delivering multi-asset solutions to institutional investors, financial advisors and individuals globally.
During the strategic review, the investment management team responsible for the firm's U.S. ETFs will remain in place, and the products will continue to pursue their respective investment objectives. However, Russell is scaling back its dedicated U.S. ETF team, primarily based out of the firm's San Francisco and New York City offices.
Source: Russell Investments
