HSBC enhances liquidity on ETF range

Dec 11th, 2012 | By | Category: ETF and Index News

HSBC Global Asset Management has added Susquehanna International Securities as a second official market maker for its exchange-traded fund (ETF) product range.

HSBC enhances liquidity on ETF range

Susquehanna International Securities will now work alongside HSBC Global Markets to ensure liquidity in HSBC’s ETF range.

The introduction of an additional market marker should improve liquidity and help investors achieve the best possible dealing price at any time of day through tighter spreads.

Susquehanna will now work in addition to HSBC Global Markets in ensuring liquidity across the range by providing continuous bid and offer prices on its 25 ETFs.

Founded in 1987 and named after the longest river on the American east coast, Susquehanna trades in a number of markets around the world and has become one of the biggest market makers in ETFs globally.

In Europe, Susquehanna acts as a liquidity provider for a large number of ETFs and is active on the London Stock Exchange, Xetra, NYSE Euronext, Borsa Italiana and SIX Swiss Exchange.

Melissa McDonald, Global Head of Equity Product at HSBC Global Asset Management, said: “This is an important milestone in the development of HSBC ETFs and is a preliminary step to improve liquidity ahead of opening our architecture to multiple authorised participants in order to meet our clients’ needs.”

HSBC started its ETF business in August 2009 and has since launched 25 physically-replicated ETFs – many of which are among the cheapest in the European market – covering the major emerging and developed markets. It ranks fifteenth in Europe, in terms of ETF assets under management, according to ETFGI.

HSBC’s ETFs are all straight equity and benchmarked to conventional market-capitalisation indices; the company does not currently offer any fixed income or commodity-based ETFs. The funds are listed on the London Stock Exchange, though many have cross-listings on other European exchanges including Xetra, NYSE Euronext and SIX Swiss Exchange.

“This recent development demonstrates HSBC’s commitment to the ETF business which has now reached $2.7 billion, and will be an important contributory factor in our drive for further growth,” McDonald added.

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