With China’s domestic exchange-traded funds industry growing at breakneck speed and its Mainland equity market steadily opening up to foreign investors, innovation surrounding Chinese indices has been a major theme so far this year. European index provider Stoxx, which earlier this year launched the market-capitalisation-weighted Stoxx China A 50 Index, has continued this theme with the introduction of the Stoxx China A 50 Equal Weight Index.
‘ STOXX ’
Stoxx, a leading index provider, has introduced the Euro Stoxx 50 BuyWrite 100% Index. The index measures the performance of a buy-write or covered-call strategy based on the Euro Stoxx 50 Index, the eurozone’s leading blue-chip equity index. The new index, which has been designed to underlie index-linked financial products such as exchange-traded funds (ETFs), represents a hypothetical portfolio of a long position in the Euro Stoxx 50 and a sold – or written – call option based on the same index.
David Stevenson has joined ETF Strategy as a weekly columnist. David is the author of the popular Financial Times Guide to Exchange Traded Funds and Index Funds and writes for the FT, Investors Chronicle and Investment Week. “I’m really excited to be writing a regular weekly column for ETF Strategy – in a very short period of time this online publication has established itself as the best source of analysis and research for investors who use ETFs here in Europe. Over the next year I can guarantee you that there’ll be many more developments at ETF Strategy, so watch this space!”, said Stevenson. In his debut column he considers European equity ETFs.
Guotai AMC has revealed plans to launch China’s first cross-border exchange-traded fund (ETF). To be listed on the Shanghai Stock Exchange, the Guotai Nasdaq-100 ETF (513100) will enable Mainland China-based investors to physically track the technology-heavy Nasdaq-100 Index. The emergence of cross-border ETFs on local stock markets such as the Shanghai and Shenzhen exchanges will significantly enhance the trading efficiency of overseas investments for Chinese investors.
Stoxx, a leading provider of financial market indices, has introduced the Stoxx Global 3D Printing Tradable Index. The new index tracks the performance of companies that generate revenues directly from 3D printing, described by US President Barack Obama as “the next revolution in manufacturing”. The index has been specifically designed to underlie exchange-traded funds (ETFs) and other investable products, and will enable investors to participate in the performance of the booming 3D-printing industry.
The potential of emerging markets (EM) is well understood, underpinned by superior growth and robust credit fundamentals. But with recent EM equity performance poor, developed market corporates could provide an attractive, alternative gateway to this potential. Stephen Cohen, Head of EMEA Investment Strategy at iShares, says: “The benefits of EM through developed markets are plenty: Some of the highest quality and most stable developed market companies have made great inroads into emerging economies. There will also be less political and foreign ownership risk, and better governance”.
S&P Dow Jones has added to its popular ‘Dividend Aristocrats’ index family with the launch of the S&P Global Dividend Aristocrats Index. The index, which has been licensed to SSgA, reflects the performance of global high-yielding companies that have demonstrated a sustainable dividend policy. The launch further expands the widely recognised Dividend Aristocrats family, which includes, among others, the S&P High Yield Dividend Aristocrats, the underlying index for the $11 billion SPDR S&P Dividend ETF (SDY).
NYSE Euronext, a leading exchange operator and index provider, has linked up with Vigeo, a France-based expert in corporate social responsibility, to launch a range of equity indices focusing on the environment, social issues and governance (ESG). The indices track companies highly rated for control of corporate responsibility risk and contribution to sustainable development.
Global index provider Russell Indexes and IdealRatings, a provider of Islamic finance information, have introduced the Russell-IdealRatings Islamic Index Series, a new index series aimed at Islamic investors seeking benchmark solutions. The new equity indices provide Shariah-compliant exposure across global, global large cap, global small cap, developed, emerging markets, US large cap, BRIC large cap and global + GCC market segments.
Exchange-traded funds (ETFs) and other exchange-traded products (ETPs) listed in Europe had net inflows of $1.3 billion in February 2013, according to research published by ETFGI, a London-based consultancy. ETFs and ETPs linked to equities gathered the largest net inflows with $1.5 billion, followed by fixed income with $403 million and active products with $380 million. Meanwhile commodity-linked products experienced net outflows of $1.15 billion. iShares gathered the largest net inflows, followed by db X-trackers/db ETC and Xact.