Asia BrokerDealers Ramp Up For More ETFs

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Brokerdealer.com blog update profiles brokerdealers’ push for a more diversified market in Hong Kong. In an effort to listen to the brokerdealers and diversify the market, Hong Kong’s Securities & Futures Commission is looking into allowing more off shore ETFs. An extract from AsianInvestor article, “SFC mulls more foreign ETF listings in HK” tells us more.

Hong Kong’s Securities & Futures Commission (SFC) is considering allowing more offshore ETFs, including from the US to be cross-listed in Hong Kong.

The move comes amid calls by some industry players from Hong Kong to diversify its ETF business, because the product range at present is predominantly Greater-China focused.

A senior executive in the ETF business told AsisanInvestor that the SFC that set up a working group to look into expanding the scope of the ETF industry and further developing int. It reached out to individual fund managers towards the end of last year to solicit interest on cross-listing their offshore ETFs in Hong Kong.

The senior executive said their group was interested in listing its American ETF in Hong Kong, but the decision hinges on the SFC and will involve a change in regulatory policy.

To read the full article from AsianInvestor, click here.

Egypt’s BrokerDealers Rejoice: ETF Trading is Finally Allowed

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download (2)Brokerdealer.com update courtesy of Reuters and profiled on MarketMuse.

Brokerdealer.com provides members with the ability to have access to international databases, one the international options is Egypt. Until this week, the Egypt Stock Exchange has not permitted for ETFs to be traded on the exchange. This will on change on Wednesday, January 14, when for the first time, ETFs will be traded. The exchange hopes that this will lead to more foreign investors and boost the economy.

Egypt’s stock exchange will allow trading in Exchange Traded Funds (ETFs) for the first time on Wednesday, as part of efforts to encourage foreign investment and boost liquidity.

ETFs are typically funds that track equity indexes, though they can also track commodities and other assets, with component stocks usually represented in proportion to the size of their market capitalization.

ETFs are traded like a stock and can allow investors to diversify their risks and reduce transaction costs.

The introduction of ETFs in Egypt comes amid a flurry of takeovers and share issues on Egypt’s stock exchange, signalling resurgent interest from international investors in a market looking to restore confidence after the turmoil unleashed by a 2011 uprising which ousted leader Hosni Mubarak.

The main stock index rose about 30 percent in 2014 and trading volumes have rebounded above levels seen in 2010.

“We are working on offering new investment vehicles to investors and in the long run, these funds will help to create liquidity in the market,” Mohamed Omran, chairman of the Egyptian Exchange, told Reuters.

“The funds will help investors reduce risk by investing in the market as a whole.”

The introduction of ETFs will also allow for the emergence of market-makers in Egypt for the first time, potentially boosting liquidity.

Egypt’s Beltone Financial Holding, which specialises in brokerage, investment banking and private equity, won Egypt’s first licence to operate an ETF on the Egyptian Exchange in April.

Its ETF is being launched with an initial value of 10 million Egyptian pounds ($1.4 million), according to Alia Jumaa, head of investment for the new fund.

For the original article from Reuters, click here

Broker-Dealer ETF $IAI Shines

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Brokerdealer.com blog update courtesy of extract from article in ETFtrends.com by Todd Shriber and Tom Lydon

A Quiet Rally For Broker-Dealers ETFs

Sep. 18, 2014 12:54 AM ET  |  

Disclosure: The author is long XLF. (More…)

Summary

By Todd Shriber & Tom Lydon

Financial services stocks and exchange traded funds have been lagging the broader market this year. That much is highlighted by a 7.5% gain for the Financial Select Sector SPDR (NYSEArca: XLF) and a 6.3% gain for the iShares U.S. Financials ETF (NYSEArca: IYF).

But as they dithered for much of the earlier part of 2014, financial services ETFs are starting to impress. Over the past month, four of the top-10 performing non-leveraged ETFs are financial services funds and that group is led by the iShares U.S. Broker-Dealers ETF (NYSEArca: IAI).

After enduring a summer swoon at the hands of lethargic trading activity, IAI has come roaring back. Over the past month, the fund is up nearly 5.1%, a performance topped by only three other non-leveraged ETFs. That while trading volumes continue to dwindle, prompting concern from some market observers about the health of the bull market. Trading has been continually slowing down since the sharp uptick after the financial crisis in 2009. Last year, daily average U.S. stock trading volume was down 37%.

Despite its trials and tribulations earlier this year, which were magnified because it was one of 2013′s best-performing financial services ETFs, IAI entered Tuesday trading less than 0.6% below its 52-week high and it looks like more upside could be on the way.

“One of the most recent sectors to step forth and grab the leadership mantle, speaking of warts, has been the broker/dealers. Despite the cyclical (or secular) decline in equity volume and the concern over the lack of bond supply, the stocks of broker/dealers have been exceptionally strong of late. Last Friday, as the S&P 500 closed down 0.6%, the NYSE ARCA Broker/Dealer Index (XBD) was up 0.6%. For the week, the XBD was up over 4%, breaking out to a 6-year high in the process,” according to J. Lyons Fund Management.

The full article can be found by clicking this link.