Global ETF News Older than One Year
IMF Working paper-Monetary Policy in the New Normal
April 4, 2014--Summary: The proposed SDN would take stock of the current debate on the shape that monetary policy should take after the crisis.
It revisits the pros and cons of expanding the objectives of monetary policy, the merits of turning unconventional policies into conventional ones, how to make monetary policy frameworks more resilient to the risk of being constrained by the zero-lower bound going forward, and the institutional challenges to preserve central bank independence with regards to monetary policy, while allowing adequate government oversight over central banks' new responsibilities. It will draw policy conclusions where consensus has been reached, and highlight the areas where more work is needed to get more granular policy advice.
view the IMF Working paper-Monetary Policy in the New Normal
Source: IMF
New Mercer study: gold is a sensible insurance in periods of capital market crisis
Portfolio risks can be reduced by adding gold
April 3, 2014--A current Mercer study examines the suitability of gold for hedging a portfolio, particularly against the backdrop of a loss in confidence in the global monetary and economic system.
The study primarily looked at gold as an asset class for institutional investors. It defines and analyses three possible scenarios that differ according to the extent of the loss in confidence. The quantitative evaluation shows that an investment in gold represents a sensible diversification for a portfolio of large-cap equities and euro zone government bonds, particularly in times of crisis on the capital market.
view the Mercer study: Gold as an asset class for institutional investors
Source: Deutsche Börse Commodities
Average daily volume of 9.4 million contracts at Eurex Group in March
New monthly all-time highs in Eurex KOSPI Product, dividend-based derivatives and RDX futures and options
April 1, 2014--In March, the international derivatives exchanges of Eurex Group recorded an average daily volume of 9.4 million contracts (March 2013: 9.7 million). Of those, 7.0 million were Eurex Exchange contracts (March 2013: 7.3 million), and 2.4 million contracts (March 2013: 2.4 million) were traded at the U.S.-based International Securities Exchange (ISE). In total, 199.4 million contracts were traded, thereof 148.0 million at Eurex Exchange and 51.4 million at the ISE.
In its largest segment-equity index derivatives-Eurex Exchange achieved 69.4 million contracts (March 2013: 65.9 million). Futures on the EURO STOXX 50 Index stood at 31.8 million contracts and 21.4 million on the index options. Futures on the DAX index totalled 3.1 million contracts while the DAX options reached another 3.9 million contracts. The Eurex KOSPI Product had a new monthly all-time high with 3.2 million contracts. Futures and options on the RDX index also reached the new monthly record of overall 327,000 contracts.
Source: Eurex
Emerging Markets Can Manage Evolving Mix of Global Investors
Composition of global investors in emerging market stocks, bonds has been changing over the past 15 years
This new mix has made capital flows more sensitive to global financial shocks
Policies to deepen emerging market financial systems can help manage risks
March 31, 2014--The mix of investors in emerging markets stocks and bonds has evolved considerably over the past 15 years, which has made capital flows and asset prices in these countries more sensitive to events outside their own borders, according to new research from the International Monetary Fund.
In its latest Global Financial Stability Report, the IMF investigates the effects of changes in the mix of these global investors.
The role of bond funds-especially local-currency bond funds-has been on the rise since the early 2000s. Savers in advanced economies now increasingly channel their money through global mutual funds that invest both in advanced and emerging market economies. The participation of sovereign wealth funds and central banks in these financial markets is growing as well.
Source: IMF
OTC Derivatives Regulators Issue Report to the G20
March 31, 2014--The Over-the-Counter (OTC) Derivatives Regulators Group (ODRG), which is made up of authorities with responsibility for the regulation of OTC derivatives markets in Australia, Brazil, the European Union, Hong Kong, Japan, Ontario, Quebec, Singapore, Switzerland, and the United States, issued a report today that identifies the current list of remaining cross-border implementation issues related to global reform of OTC derivatives markets.
The report also includes a summary of the status of such issues and a timetable for addressing them through a series of reports to the G20 Finance Ministers and Central Bank Governors over the course of 2014.
Source: CFTC.gov
IMF Working paper-Fiscal Limits, External Debt, and Fiscal Policy in Developing Countries
March 31, 2014--Summary: This paper studies fiscal policy effects in developing countries with external debt and sovereign default risks. State-dependent distributions of fiscal limits are simulated based on macroeconomic uncertainty and fiscal policy specifications. The analysis shows that expected future revenue plays an important role in the low fiscal limits of developing countries, relative to those of developed countries.
External debt carries additional risks since large devaluation of the real exchange rate can suddenly raise default probabilities. Consistent with majority views, fiscal consolidations are counterproductive in the short and medium runs. When an economy approaches its fiscal limits, government spending can be less expansionary than in a low-debt state. As more revenue is required to service debt in a high-debt state, higher tax rates raise the economic cost of increasing consumption, reducing the fiscal multiplier.
view the IMF Working paper-Fiscal Limits, External Debt, and Fiscal Policy in Developing Countries
Source: IMF
ICE Splits NYSE Liffe, Euronext Feeds
March 28, 2014--NYSE Euronext has introduced a new commercial model for real-time data from its Liffe derivatives market that will see London-listed derivatives unbundled from continental European derivatives, as a result of ongoing plans to spin off Euronext's European cash and derivatives markets following IntercontinentalExchange's acquisition of NYSE Euronext last year.
Effective April 1, London-listed derivatives data will move to ICE under a new package dubbed Liffe...
Source: Waters Technology
BNY Mellon Automates Calculation of Collateral Requirements in ETF Marketplace
Designed to Lead to More Efficient, Reliable Market
March 27, 2014--BNY Mellon, a global leader in investment management and investment services, has automated the calculation of collateral requirements in the exchange-traded funds (ETF) marketplace.
The BNY Mellon enhancement is designed to reduce errors in ETF transactions and improve the ability of Authorized Participants (APs) to manage and allocate funds.
The primary market in ETFs is driven by APs which are large financial institutions/broker dealers that trade the underlying securities during the creation or redemption of ETF units.
Source: BNY Mellon
Standard Life Investments buys fund manager Ignis for 390m pounds
March 26, 2014--Standard Life Investments, the Edinburgh-based pensions and insurance firm, has bought Ignis Asset Management from life assurer Phoenix Group.
The company paid £390m for Ignis and says the deal will mean its assets under management will increase by more than 30% to £240bn.
Source: BBC.com
Advisers turn to ETFs to drive down costs
March 25, 2014--Some financial advisers are using exchange traded funds (ETFs) heavily in client portfolios, drawn to the low-cost structure, intraday trading and tax benefits.
In fact, 16.5 per cent, or 66 of the top 400 advisers surveyed by the Financial Times, allocate 20 per cent or more of their overall assets under management (AUM) to ETFs.
Source: FT.com
