Euronext debuts London ETF platform with Lyxor launch

May 3rd, 2016 | By | Category: ETF and Index News

Pan-European exchange Euronext has extended its exchange-traded fund listing and trading capabilities to London, giving ETF issuers access to UK investors while continuing to benefit from Euronext’s trading and distribution network. The first ETFs to list and start trading on Euronext London this morning were the Lyxor FTSE EPRA/NAREIT Global Developed UCITS ETF and the Lyxor Euro Stoxx Banks UCITS ETF.

Euronext London debuts ETF listing capability

Lee Hodgkinson, Head of Markets and Global sales and CEO Euronext London.

Euronext have stated they will seek to attract clients by providing benefits such as competitive pricing, efficient European cross listing ability and reduced time to market.

The exchange group now provides ETF issuers with access to five European markets: Amsterdam, Brussels, Lisbon, Paris and London, its FCA Recognized Investment Exchange. The service is delivered through a single entry point, on one technology platform with a harmonised rulebook. Clearing and settlement for London ETFs will take place through EuroCCP and Euroclear UK & Ireland, respectively. The first trading participants on Euronext London include Société Générale and Kepler Cheuvreux.

‘London is an important ETF market and the UK distribution network is increasingly valuable mainly thanks to the Retail Distribution Review which is now starting to facilitate ETF penetration among the retail community,’ said Lee Hodgkinson, Head of Markets and Global sales and CEO Euronext London. ‘By bringing together our unparalleled capital markets community we are helping Eurozone ETF issuers to extend their reach to UK investors and generate additional liquidity.’

The Lyxor FTSE EPRA/NAREIT Global Developed UCITS ETF tracks the performance of listed companies which are players of the real estate market within developed countries. The index is denominated in USD and calculated by FTSE. As of 27 April 2016 the underlying index has significant exposure to the US (52.7%), Japan (12.0%), Hong Kong (7.4%), Australia (6.1%) and the UK (5.4%). There are 330 constituents in the index of which the largest member is Simon Property Group (4.6%). The total expense ratio (TER) is 0.45%.

The Lyxor EUROSTOXX BANKS UCITS ETF tracks the benchmark EURO STOXX Banks Net Return EUR Index. The EURO STOXX Banks Index measures the performance of banks (as defined by the Industry Classification Benchmark) in the euro zone. As of 27 April 2016 the underlying index has significant country exposure to Spain (32.7%), France (23.3%), Italy (17.8%), the Netherlands (10.1%) and Germany (7.5%). The index has 30 constituents of which the largest members are Banco Santander (15.6%), BNP Paribas (12.7%), Banco Bilbao (10.3%), ING Groep (10.1%) and Intesa SanPaolo (8.5%). The fund has a TER of 0.30%.

Euronext is one of the leading platforms in Europe for ETF listing and trading, counting more than 700 instruments on its markets in Amsterdam, Brussels, Lisbon, Paris and London. Trading volume increased by 74% during 2015 for the group.

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