ETFs

Bank of Japan, ETFs, Securities Lending

Japan acts to avert ETF market liquidity squeeze The Bank of Japan has launched an unusual lending facility for exchange traded funds as it tries to mitigate the market impact…

Zero fee fund managers have incentives to improve securities finance market structure

November 25, 2019

ETFs, Investments, Securities Lending

ETFs, mutual funds, Securities Lending, topstory, Zero fee

The growth of zero fee ETFs has fingers pointing in the direction of securities lending as a main way that these funds earn revenues. Managers in this space have an…

BNY Mellon: signs point to wider adoption of ETF collateral

October 3, 2019

BNY Mellon, collateral, ETFs

The market for exchange-traded funds (ETFs) has skyrocketed over the past quarter-century, thanks to the trillions of dollars investors are put¬ting to work in passive, index-tracking strategies. What hasn’t yet…

Citi, J.P. Morgan and SocGen join UCITS ETF platform

October 3, 2019

Barclays, Citi, ETFs, hanETF, J.P. Morgan, Societe Generale, UCITS

HANetf, Europe’s first independent ‘white label’ UCITS ETF platform has confirmed a further tranche of Authorised Participants (APs) for its range of on-platform funds: Citigroup Global Markets, JP Morgan Securities…

Royal Mint to develop first listed product on gold with UCITS ETF issuer

September 10, 2019

ETFs, hanETF, Royal Mint, UCITS

HANetf, a European UCITS ETF issuer, announced a collaboration with The Royal Mint to develop and launch a physically-backed gold ETC. This will make the Royal Mint the first sovereign…

Monday News Update, risk edition: bond markets, possible negative US rates, trading and more (Premium)

September 9, 2019

ETFs, Interest rates, Investments, Risk Management

bond markets, Brexit, Emerging Markets, ETFs, negative rates, topstory, US interest rates

There’s heady news in the markets these days. We’ve been paying attention to how investors should think about risk in positioning global bonds, the possibility of negative US interest rates,…

Credit Suisse completes transfer of InvestLab to Allfunds

September 6, 2019

News and Notes – Fintech, Uncategorized

Allfunds, Credit Suisse, ETFs, InvestLab, mutual funds

Credit Suisse announced the closing of the transfer of its third party investment fund platform InvestLab to Allfunds. In a company statement late June, Credit Suisse stated that “that the…

Tradeweb in ETF clearing partnership with EuroCCP

September 6, 2019

CSDR, ETFs, EuroCCP, Tradeweb

Tradeweb Markets and EuroCCP announced a strategic collaboration to facilitate central counterparty clearing for European Exchange Traded Funds (ETFs). It is expected to streamline European clients’ settlement process and minimize…

EFAMA: liquidity concerns about ETFs are misplaced

July 17, 2019

EFAMA, ETFs, Europe, Liquidity

EFAMA recently finalised a Comment Paper in response to the ECB’s November 2018 findings around liquidity and counterparty risks in ETFs, included in the ECB’s semi-annual Financial Stability Review. While…

We review the Better Finance report criticizing EU asset manager seclending fee splits (Premium)

May 13, 2019

ESMA, ETFs, Europe, Securities Lending

ESMA, ETFs, Europe, Securities Lending, topstory, UCITS

Independent European consumer organization BETTER FINANCE released a report on UCITS fee splits in the European securities lending market. They found the known wide disparities in fee splits and criticized…

Industry responds to SEC proposals on ETF custom basket creation/redemption (Premium)

April 22, 2019

ETFs, Investments

creation, ETFs, redemption, topstory

The ETF industry and associations are now responding to the SEC’s proposal that ETF operators be able to accept and provide “custom baskets” of cash and securities that are not…

MarketAxess and Virtu Financial partner on global ETF and Fixed Income trading

April 8, 2019

ETFs, MarketAxess, Virtue Financial

NEW YORK, April 04, 2019 (GLOBE NEWSWIRE) — Virtu Financial, Inc. (NASDAQ:VIRT) and MarketAxess Holdings, Inc. (NASDAQ: MKTX), two global leaders in electronic trading, today announced a partnership to provide…

Finadium launches enhanced analytics for US mutual funds and ETFs in securities lending; invites beta testers for online access

April 8, 2019

ETFs, Investments, Securities Lending, Technology

ETFs, Finadium, mutual funds, Securities Lending, topstory

Finadium has created an enhanced database of US mutual funds and ETFs in securities lending that incorporates SEC filings and additional industry content. The database provides clients a comprehensive analysis…

Fintech weekly deals and partnerships roundup

Medici Ventures takes minority stake in blockchain banking platform Overstock announced its wholly-owned blockchain subsidiary, Medici Ventures, has purchased a 5.1% stake in Bankorus, a blockchain banking platform focused on…

Autonomous Next: SoFi’s zero fee ETF and crypto app challenges financial industry

March 4, 2019

Coinbase, cryptocurrency, ETFs, robo-advisors, SoFi

SoFi has thrown two bricks through the window of the finance industry this week. The first is a set of no-fee Exchange Traded Funds (ETFs) to be distributed through its…

CNBC: Fidelity and Schwab cut trading commissions on more ETF

February 13, 2019

ETFs, fidelity, Schwab

The price war between major U.S. brokerages heated up Tuesday after Charles Schwab and Fidelity both announced they would expand commission-free trading to hundreds more exchange-traded funds. Both companies said…

Tradeweb platform posts record January at $624.5bn yoy

February 11, 2019

China, credit, derivatives, ETFs, MBS, Repo, Tradeweb, trading platforms

While growth was broad-based across all asset classes traded on the Tradeweb platform, some of the sharpest gains were noted in investment grade and high-yield US credit, mortgage-backed securities, and…

CBOE withdraws bitcoin ETF proposal

January 25, 2019

bitcoin, CBOE, ETFs, Securities and Exchange Commission, VanEck

CBOE has filed a “Notice of Withdrawal” for its proposal to the SEC for the listing and trading of a bitcoin ETF issued by VanEck under the name SolidX Bitcoin…

ETF.com: Get Ready For Zero Fee ETFs

January 5, 2019

ETFs, Securities Lending

A flat U.S. stock market and losses in the U.S. bond and most international markets mask what has been another impressive year for ETF inflows of approximately $280 billion as…

WSJ: Investors sell short $10 Billion of bond ETFs

December 12, 2018

Bonds, ETFs, Short selling, WSJ

Warning lights are flashing in a corner of U.S. debt markets. Bond investors scrambling to protect themselves from losses are increasingly using bets against the largest junk-bond exchange-traded funds and…

The ECB finds risk in ETF securities lending and TRS – is this real or a rehash of old stories?

December 3, 2018

ECB, ETFs, Securities Lending, Total Return Swaps

ECB, ETFs, Securities Lending, topstory, Total Return Swaps

The European Central Bank released their Financial Stability Report last week, including a feature on counterparty risk in synthetic and physical ETFs. We find some valid points in the analysis…

IOSCO identifies core market risks, including crypto assets and advanced tech – IIAC CEO

November 20, 2018

artificial intelligence, crypto assets, DLT, ETFs, GDPR, IIAC, IOSCO, machine learning

An open letter from Ian Russell, president and CEO of Investment Industry Association of Canada (IIAC) provides a perspective on risks in global capital markets, the priorities for further reform,…

FXStreet: bitcoin market in turmoil as first Swiss ETP listing approved

November 19, 2018

bitcoin, cryptocurrencies, ETFs, SIX

The bitcoin price opened the week’s trading with declines wiping out $13 billion after a week that saw $26 billion disappear in a 12-hour period. This is happening at a…

How investment automation and ESG factors are growing, together

October 30, 2018

Automation, Technology

AI ethics, automation, Blackrock, ESG, ETFGI, ETFs, Robo Global, World Federation of Exchanges

Investment dollars are at serious risk in an age of transparency for governments and companies alike, and investors can be fickle when it comes to market moving events that stem…

Bloomberg: Robo-ETF outperforms S&P 500

October 22, 2018

AIEQ, artificial intelligence, ETFs

A robot ETF has been leaving “pros in the dust, scoring wins on small-cap fliers”, reports Bloomberg. Everyone knows fund managers can’t keep up with benchmarks, and the last 12…

The SEC’s proposed ETF rules help ETF market makers but hurt securities lenders (Premium)

October 1, 2018

Liquidity Management, Operations, Securities Lending

ETFs, market makers, sec, Securities Lending, topstory

A new proposed regulation from the US Securities and Exchange Commission (SEC) will make the ETF market more efficient while predictably creating new winners and losers, in this case market…

What no-fee fund products mean for the securities lending market

August 7, 2018

ETFs, Securities Lending

ETFs, Securities Lending, topstory

The first no-fee ETFs and funds are now being marketed by Fidelity. Other asset managers have already seen share-price declines and more no-fee products are expected to follow. Securities lending…

Can Fixed Income ETF liquidity hold up against underlying liquidity changes? Panel respondents say yes

April 26, 2018

ETFs, Fixed Income, Liquidity Management

ETFs, Fixed Income, Liquidity, topstory

The Fixed Income ETF marketplace is undergoing scrutiny as liquidity gravitates to these products and away from the underlying. The fact is, ETFs are easier to trade than individual fixed…

FISL NYC 2018: data tells a story of shifting market dynamics and beneficial owner priorities

April 12, 2018

FISL

benchmarking, Beneficial Owners, DataLend, ETFs, FISL NYC 2018, HQLA, revenues, Securities Lending, topstory

The kick off to Finadium’s second annual FISL conference in New York was about understanding what’s changing in the securities lending markets as global economies respond to large policy changes.…

Barron’s: ETFs’ hidden source of return is securities lending

April 9, 2018

How can an index ETF beat the index? By earning some money on the side to offset its annual fees. Securities has found new life in the world of ETFs.…

High-yield ETFs attract record demand from short sellers

February 28, 2018

Outflows from high yield ETFs accelerated in 2018 and short demand for HY ETFs is at the highest level recorded, currently over $7 billion in total, IHS Markit data show. Demand…

FT: stock lending by ETF operators worries investors

February 5, 2018

collateral, ETFs, Securities Lending

Investors are concerned about loaning out stocks, arguing the income generated by securities lending is unlikely to offset the risks, especially in market downturns. One concern for investors is the…

Citi adds ETFs as eligible collateral for seclending

January 31, 2018

Citi, collateral management, ETFs

Citi added Exchange Traded Funds (ETFs) to the list of instruments it accepts as collateral in agency securities lending transactions. Using Markit’s IHS collateral lists to identify eligible ETF instruments –…

Moody’s: MiFID II will prompt greater use of ETFs in securities lending

January 8, 2018

ETFs, Moody's, Securities Lending

The introduction of the second instalment of the European Union’s Markets in Financial Instruments Directive will bring widespread change to how asset management products are designed and sold, said Marina…

Cost optimisation challenges for asset managers in 2017

September 21, 2017

mstan

ETFs, Europe, Investments, Regulatory, UK

asset managers, ETFs, James Treseler, MiFID II, Societe Generale, topstory

Asset management may be considered a profitable business but the trend has recently been moving in the opposite direction. A new raft of challenges, ranging from MiFID II to the…

Finadium: Can ETFs Replace Cash Accounts?

September 20, 2017

Cash management, ETFs, Investments, Liquidity Management, US

cash management, ETFs, Liquidity Management, topstory, ultra short

A new research report from Finadium looks at the range of ultra short ETFs, some of which are competing with traditional cash accounts for investor interest. This report should be…

ETF Trends: The First Short Squeeze ETF Hits the Market

March 24, 2017

ETFs, Securities Lending, short squeezes

Investors can now capitalize on a potential quick turnaround in a heavily shorted segment of the market through a new actively managed contrarian exchange traded fund play that bets on…

ETF.com: Don’t Scorn The Short-Seller

January 18, 2017

ETF.com, ETFs, Short selling

As I recently discussed, the academic literature shows that short-sellers, while often demonized, play an important role in captal markets. For example, short-sale constraints prevent pessimistic opinions from being fully…

Morningstar: 4 ETF Myths Debunked

December 8, 2016

ETFs, Morningstar, Securities Lending

Myth 3: Only ETFs Lend Securities On more than one occasion, I have heard ETFs criticised for engaging in the ‘funny business’ of securities lending, which sees a percentage of…

Our analysis of the SEC's new securities lending disclosure rules for mutual funds (Premium)

October 19, 2016

Investments, Regulatory, SEC, US

ETFs, modernization, mutual funds, sec, Securities Lending, topstory

The US Securities and Exchange Commission (SEC) released its final rules on October 13, 2016, modernizing reporting and liquidity disclosures for mutual funds, ETFs and similar registered investment companies. We analyze the…

WSJ: The ETF With the 0.00% Fee

October 10, 2016

ETFs, Securities Lending, WSJ

Because most ETFs funds track markets rather than trying to beat them, their costs are extremely low — and, with the latest iShares fee cuts, are approaching zero. Meanwhile, ETFs…

FT Advisor: Vanguard to allow securities lending on largest ETFs

August 30, 2016

Vanguard is to allow its largest European exchange-traded funds to begin lending out securities in order to generate more revenue for investors. The US firm has added a provision to…

Euroclear on ETF securities lending: is it on your to-do list?

March 25, 2016

ETF Securities Lending creating a path to greater liquidity Euroclear, March 24, 2016 The US ETF securities lending market is worth about USD$100bn, with 30% of that total on loan…

The Robo Advisor is starting to matter to securities finance (Premium)

February 18, 2016

Richard Stinchfield

Investments, Pensions, Securities Lending, Technology

agency securities lending, ETFs, mutual funds, technology, topstory

Recently, TheStreet.com published its top ten list of Robo Advisors and some of the statistics quoted were pretty interesting (see Exhibit 1). Robo Advisor services are heavily targeted towards the…

Finadium report: ETF Risk in the New Regulatory Environment

February 8, 2016

Collateral Management, Derivatives, Regulatory, Securities Lending

collateral management, derivatives, ETFs, Finadium, Liquidity, Securities Lending, systemic risk, topstory, volatility

A new Finadium report looks at liquidity and operational risk in the ETF market given recent changes in underlying market liquidity and volatility, as well as regulatory concerns about fire-sale…

Should we be worried about equity ETFs as the next big potential crisis? (Premium)

January 4, 2016

Derivatives, Liquidity Management

ETFs, Liquidity, topstory

The press has been abuzz about potential systemic risk concerns stemming from ETFs of all sorts, and this crept into our holiday conversations as well. The events of August 24,…

The UK Investment Management Association wants to talk about clearing and segregation of client assets

August 9, 2012

CCP, Collateral Management, Derivatives, Europe, Money Market Funds, Regulatory

CCPs, Clearing, collateral management, ESMA, ETFs, Investment Management Association, UCITS

The UK’s Investment Management Association released today a response to ESMA’s recent guidelines on UCITS and ETFs. Aside from the technical points, they brought up some new issues regarding the…

Artfully Dodging the Liquidity Coverage Ratio in Securities Lending and Repo.

May 29, 2012

Jonathan Cooper

Collateral Management, Liquidity Management, Regulatory, Repo, Securities Lending

Bank of England, Basel III, collateral management, ETFs, Federal Reserve, Finadium, LCR, Liquidity Coverage Ratio, Regulations, Repo, Securities Lending, Shadow Banking

Banks everywhere are focusing on the Liquidity Coverage Ratio (LCR) provisions in Basel III. The provisions don’t kick in until 2015, but the observation period is in full swing and…

Cheat sheet on IOSCO ETF consultation paper for securities lenders

March 16, 2012

Regulatory, Securities Lending

ETFs, IOSCO, Securities Lending