Oil volatility pushes Boost ETP trading volumes to record high

Mar 9th, 2016 | By | Category: Alternatives / Multi-Asset

Trading volumes at Boost ETP, a specialist provider of short and leveraged exchange-traded products, surpassed the $1.5bn mark in February. The milestone comes on the back of amplified volatility in oil markets – the CBOE Crude Oil Volatility Index reached a level not seen since January 2009 – and strong demand for its LSE and Borsa Italiana-listed oil ETPs, particularly the Boost WTI Oil 3x Leverage Daily ETP (3OIL).

Boost’s Short and Leveraged ETP range sees record trading in February

Hector McNeil, Co-CEO of WisdomTree Europe.

3OIL, which provides three times the daily performance of the NASDAQ Commodity Crude Oil ER Index, has proved popular with traders looking to capitalise on a rebound in the price of crude oil.

Trading volumes across the firm’s ETP platform have progressively trended upwards since the platform’s debut in 2012 as an increasing number of investors have embraced short and leveraged ETPs as an alternative to futures and CFDs. Calculated across all its products, February’s trading volume represents a 186% increase year-on-year and 22% since January.

Trading on Borsa Italiana, which benefits from a healthy local market for short and leveraged ETPs, accounts for the vast majority of the firm’s volumes.

Commenting on the milestone, Hector McNeil, Co-CEO WisdomTree Europe, said: “The growth in trading volumes is a strong affirmation of the value of Boost’s short and leveraged products in today’s volatile markets. Investors have access to hedging strategies across a range of asset classes with the recent focus being on oil, equities and fixed income.”

He added: “We have seen consistent growth in assets across both our [Boost] ETP and [WisdomTree Europe] UCITS ETF platforms, and have reached record AUM levels growing by nearly 200% over the past year, as clients recognise the benefits and uses of these differentiated products.”

Short and leveraged ETPs have many and varied uses, from risk management to tactial trading. These include: leveraging daily returns of an investment for the same capital as a non-leveraged trade; hedging existing positions in one simple trade; implementing long or short strategies to take advantage of any short-term rises or falls in the market; pair trading; and shorting.

Boost ETP is a division of WisdomTree Europe.

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