Saturday 25th April 2015
NEWS TICKER: FRIDAY, APRIL 24th 2015:Luc Luyet, CIIA – Senior Market Analyst AT Swissquote says that yesterday, “the SNB surprised the market by announcing that the number of sight deposit account holders that are exempt from negative interest has been reduced. This decision doesn’t change much the domestic banks’ situation as the “20 times the minimum reserve requirement” rule is still running. On the other side, the institutions associated with the Confederation, such as the pension fund of the Confederation or the pension fund of the SNB, are no longer exempt of negative interest. Consequently, only the account holders of the national social security system are still fully exempt.” - High yield debt issuance remains buoyant. Issuance volume for the week ending April 17, 2015, slowed down a bit from the previous week, but remained strong. Junk bond, or high-yield debt, issuers continued to issue bonds as yields remained favourable. High-yield debt is tracked by the SPDR Barclays Capital High Yield Bond ETF and the iShares iBoxx $ High Yield Corporate Bond Fund. According to data from S&P Capital IQ/LCD, dollar-denominated bonds amounting to $10.75bn were issued across 16 transactions in the week ending April 17th. The issuance volume fell by 3.2% from the week ending April 10. Pricing was evenly spread across the week. The number of transactions fell from 18 to 16 week-over-week. Last week brought the total US dollar issuance of high-yield debt to $115.8bn in 2015 YTD, up some 15% from the same period in 2014, the bulk of which is refinancing of older debt - Moody's says EMEA auto ABS performance remained stable during the three-month period ending February 2015. The sector's average performance trend was positive in terms of delinquency ratios and cumulative losses. The 60+ day delinquencies decreased to 0.66% in February 2015 from 0.77% in February 2014, while cumulative defaults decreased to 1.06% from 1.20% over the same period. This decrease was due mainly to the good performance of the German and Dutch markets. The prepayment rate increased slightly to 13.49% in February 2015 from 13.30% a year earlier. As of February 2015, the pool balance of all outstanding rated auto ABS transactions was €27.55bn - According to Sino specialists Red Pulse, China’s State Council is considering allowing daily repatriation for QFII. Currently, RQFII enjoys T+1 repatriation while QFII is restricted to T+5. QFII is the largest channel for foreign investment into China with quota of USD150bn, however, only half of the quota is in use, like at least partly due to the five-day repatriation stipulation - Malaysia’s state pension fund will offer a Shari’a-compliant investment option for its members by 2017, Prime Minister Datuk Seri Najib Razak said today. Najib says it will create the largest Shari’a fund of its kind in the world. Malaysia has one of the world’s largest Islamic finance sectors and the authorities are keen to develop it further. They envision the industry accounting for 40% of the country’s total banking assets by 2020 compared with latest figures of around 23% released last year. The $160bn (MYR577.4bn) Employees Provident Fund (EPF) already invests about a third of its portfolio in stocks and bonds that comply with Islamic principles, which ban interest payments and pure monetary speculation. The fund reportedly hired consultants last year to study the feasibility of a state-backed pension fund focusing entirely on Shari’a-compliant investments. Additionally, local press reports says that Malaysia’s sovereign wealth fund Khazanah Nasional has received regulatory approval to issue a MYR1billion (around $275m) socially responsible Islamic bond - The NASDAQ OMX Group, Inc has declared a regular quarterly dividend of $0.25 per share on the company's outstanding common stock, an increase of 67% from the prior $0.15 per share quarterly dividend. The dividend is payable on June 26TH 2015, to shareowners of record at the close of business on June 12TH 2015 - Lazard Ltd today reported operating revenue1 of $581m for the quarter ended March 31st. Adjusted net income was $103m, or $0.77 (diluted) per share for the quarter. These results exclude a pre-tax charge of $63m relating to a debt refinancing2. Q1 2015 net income on a U.S. GAAP basis, including the pre-tax charge, was $56m, or $0.42 (diluted) per share. "Our Financial Advisory and Asset Management businesses continue their strong performance," says Kenneth M. Jacobs, Chairman and Chief Executive Officer of Lazard. "In the first quarter, we refinanced and repaid a portion of Lazard's long-term debt, significantly reducing our interest costs," adds Matthieu Bucaille, chief financial officer of Lazard. "Consistent with our capital management objectives, we have increased the quarterly dividend by 17%, the fifth increase in as many years." -

L&G Investment Management and Source offer a new index for commodity investment

Monday, 09 January 2012
L&G Investment Management and Source offer a new index for commodity investment Legal & General Investment Management (LGIM) and Source have launched the LGIM Commodity Composite Source ETF. The fund, which tracks the LGIM Commodity Composite Index, is designed to offer diversified exposure to commodities in a UCITS-compliant exchange traded fund (ETF).  http://www.ftseglobalmarkets.com/

Legal & General Investment Management (LGIM) and Source have launched the LGIM Commodity Composite Source ETF. The fund, which tracks the LGIM Commodity Composite Index, is designed to offer diversified exposure to commodities in a UCITS-compliant exchange traded fund (ETF). 

The LGIM Commodity Composite Index aims to be a new kind of benchmark for broad-based commodity exposure, says L&G. Using LGIM’s experience as an index manager (LGIM manages £347bn in assets) and both a quantitative and qualitative screening process, it offers exposure to a selection of what it terms ‘best of breed’ commodity indices. Graeme Dewar, head of strategy implementation at LGIM, explains that the firm is “seeing increasing demand from pension clients looking for access to this asset class.  Their primary requirements are for an efficient, dynamic product with diversification of counterparty risk.  Our solution has been to develop an innovative type of benchmark index that includes a minimum of three constituent sub-indices.  These sub-indices are selected using LGIM’s experience and core skill set to deliver a high quality, dynamic commodity composite index.”

The index at launch comprises four sub-indices and will be reviewed at least annually to ensure that it captures developments in commodity indexation.



Investors wishing to gain exposure to the LGIM Commodity Composite Index can do so via the LGIM Commodity Composite Source ETF. Source’s ETF structure combines physical investment in US Treasury bills with a swap overlay to provide more consistent index tracking. To diversify both counterparty risk and the composition of the index, the index references a number sub-indices and the fund will use multiple swap counterparties.  Source says it has mandated four swap counterparties for this product: Barclays Capital, Citigroup, JP Morgan, and UBS.

The LGIM Commodity Composite Source ETF will complement Source’s existing range of exchange traded commodities. Source chief executive Ted Hood explains: “Single-commodity ETCs are useful for investors who want to build a tailored portfolio. But, like LGIM, we see the need for a well-constructed commodity index, providing diversified exposure, at a reasonable cost and in a UCITS-compliant fund.  We are delighted to be partnering with LGIM, one of the world’s leading index managers, to create an ETF that tracks this groundbreaking index”.

The LGIM Commodity Composite Source ETF is listed on the London Stock Exchange and trades in GBP and USD. It is registered for sale in the UK and Ireland and is in the process of being passported to Austria, France, Germany, Finland, Italy (for institutional investors only), Luxembourg, the Netherlands, Sweden and Switzerland.

INDEX COMPOSITION

The indices included in the initial composition of the LGIM Commodity Composite Index are as follows:

 

Index name

Bloomberg Code

Barclays Capital Commodity Index Pure Beta TR

BCC1C1PT Index

Citi CUBES Index Total Return

CCUBDJTR Index

JPMCCI Ex-Front Month Energy Light Index (Total Return)

JMCXXELT Index

UBS Bloomberg Constant Maturity Commodity Index

CMCITR Index

PRODUCT SUMMARY

Product Name

LGIM Commodity Composite Source ETF

ISIN

 IE00B4TXPP71

Base currency

USD

Trading currency

GBP / USD

Management Fee

0.40% per annum

Average Swap Fee

0.45% per annum

Listing

London Stock Exchange

Benchmark

LGIM Commodity Composite Index

Benchmark Bloomberg Ticker

TGPLGCC <Index>

UCITS eligible

Yes

Domicile

Ireland

 

 

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