LISTED PRODUCT NEWS
ETP TURNOVER 10PC OF EQUITY ACTIVITY
The latest figures from BlackRock’s exchange-traded fund (ETF) division show that exchange-traded product turnover was 10.45 per cent of equivalent equity market activity but was down 8.8 per cent on the previous week at €10bn. Country-related products saw the greatest turnover at €2.1bn, an increase of 1.8 per cent on the previous week. The fixed income area had the highest increase in turnover, up 10 per cent on the previous week, while regional turnover fell by 26 per cent.
RBS SEMINAR ON FALLING MARKETS
Flat or falling markets present traders with a real challenge to make profits but it is possible to make some money even when the markets aren’t moving up or down. RBS is holding a seminar next Tuesday between 5.30pm and 6.30pm to show you how its listed products range can help you. Its range runs from Autocalls and Synthetic Zeros to put covered warrants, catering for all levels of risk. The seminar will be held at RBS’s HQ at 250 Bishopsgate. To register, call 0800 121 6286 or email [email protected].
TCF ADVISES DUE DILIGENCE WITH ETFS
Low cost passive asset manager TCF Investment warned this week that investors should exercise thorough due diligence before investing in ETFs or passive funds by checking an ETF’s index suitability, its stock lending policy, the vehicle structure and whether it is geared or not. For example, swap-backed ETFs expose you to fundamental credit risk with the swap counterparty, which TCF feels any investors are largely unaware of. The rise of ETFs that offer leveraged returns, short exposure and active management is seen by TCF as cause for concern and only really suitable for the most sophisticated investors.
SOCGEN LAUNCHES WHEAT WARRANTS
Recent volatility in the agricultural markets has prompted Societe Generale’s listed products team to launch four wheat covered warrants, of which three are call warrants. The shortest warrants expire on 26 November with a strike price of $8 while the put warrant has the same expiry, also with a strike of $8. The call warrant returns a profit if the price of the underlying exceeds $8. The remaining two call warrants will expire in February 2011 with strike prices of $9 and $10, indicating demand to bet on rising food prices.