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ETF Securities list 33 Leveraged ETCs and
4 new commodities on the London Stock Exchange today
17/03/08
- Leverage ETCs providing 2x exposure to 33 commodity indices
- 4 new DJ-AIG commodity indices added to ETC platform: cocoa,
lead, tin, platinum
ETF Securities, the global pioneer of exchange traded commodities (ETCs) has
added to its ETC platform with the introduction of 33 Leveraged ETCs. And DJ-AIG have added four new commodity indices: Cocoa, Lead, Tin and Platinum. The
new ETCS will be available as of today on the London Stock Exchange. A total of
110 ETCs will have been created by ETF Securities. The new ETCs will
complement ETF Securities’ existing Physical, Classic, Forward and the recently
launched Short ETCs which provide investors long and short exposure to the
commodities market.
Leveraged ETCs allow investors to earn a positive return when the index is rising
with 50% less capital. Leveraged ETCs earn two times (+2x) the daily percent
change in the index (before fees and interest). For example, if the underlying
index rises by 2% in a day, a Leveraged ETC will increase by 4% and vice versa.
In today’s market where it is increasingly difficult to obtain credit and margin,
Leveraged ETCs free up additional capital for investor’s to gain additional portfolio
diversification.
The ETC platform offered by ETF Securities has experienced massive growth in
the past thirteen weeks with assets growing by 150% to over $5.1 billion and
daily trading volumes doubling to over $120 million per day across five European
exchanges. The increase in assets has occurred as a result of increased
awareness of commodities and ETCs, volatile equity markets creating demand for
non-correlated assets, positive commodity fundamentals, inflation fears and
annual portfolio rebalancings made at the start of the new year.
Leveraged ETCs tracking existing indices:
| Leveraged Individual ETCs |
LSE Code |
Leveraged Index ETCs |
LSE Code |
| ETFS Leveraged Aluminium |
LALU |
ETFS Leveraged All Commodities DJ-AIGCISM |
LALL |
| ETFS Leveraged Coffee |
LCFE |
ETFS Leveraged Agriculture DJ-AIGCISM |
LAGR |
| ETFS Leveraged Copper |
LCOP |
ETFS Leveraged Energy DJ-AIGCISM |
LNRG |
| ETFS Leveraged Corn |
LCOR |
ETFS Leveraged Ex-Energy DJ-AIGCISM |
LNEY |
| ETFS Leveraged Cotton |
LCTO |
ETFS Leveraged Grains DJ-AIGCISM |
LGRA |
| ETFS Leveraged Crude Oil |
LOIL |
ETFS Leveraged Industrial Metal DJ-AIGCISM |
LIME |
| ETFS Leveraged Gasoline |
LGAS |
ETFS Leveraged Livestock DJ-AIGCISM |
LLST |
| ETFS Leveraged Gold |
LBUL |
ETFS Leveraged Petroleum DJ-AIGCISM |
LPET |
| ETFS Leveraged Heating Oil |
LHEA |
ETFS Leveraged Precious Metals DJ-AIGCISM |
LPMT |
| ETFS Leveraged Lean Hogs |
LLHO |
ETFS Leveraged Softs DJ-AIGCISM |
LSFT |
| ETFS Leveraged Live Cattle |
LLCT |
| ETFS Leveraged Natural Gas |
LNGA |
| ETFS Leveraged Nickel |
LNIK |
| ETFS Leveraged Silver |
LSIL |
| ETFS Leveraged Soybean Oil |
LSYO |
| ETFS Leveraged Soybeans |
LSOB |
| ETFS Leveraged Sugar |
LSUG |
| ETFS Leveraged Wheat |
LWEA |
| ETFS Leveraged Zinc |
LZIC |
Short and Leveraged ETCs tracking new commodity indices:
| Short Individual ETCs |
LSE Code |
Leveraged Individual ETCs |
LSE Code |
| ETFS Short Cocoa |
SCOC |
ETFS Leveraged Cocoa |
LCOC |
| ETFS Short Lead |
SLEA |
ETFS Leveraged Lead |
LLEA |
| ETFS Short Platinum |
SPLA |
ETFS Leveraged Platinum |
LPLA |
| ETFS Short Tin |
STIM |
ETFS Leveraged Tin |
LTIM |
In addition to their obvious benefits, Short and Leveraged ETCs provide investors
with a wider range of investment strategies including: pairs trades when an
investor has a view that one commodity will rise or fall in price relative to another
commodity; reducing or increasing commodity price risk where a portfolio owns
commodity companies; and investment strategies which exploit the shape of a
commodity futures curve allowing investors to “short” the part of the curve in
contango and to go “long” the part of the curve in backwardation.
Leveraged ETCs also offer the same benefits as the existing ETCs. They are
simple to trade on a major stock exchange, they can be settled and held in
ordinary brokerage accounts, they are transparent and have a clear pricing
formula. In addition, ETCs are highly liquid with multiple market makers providing
liquidity and continuous pricing. Since Leveraged ETCs are priced off the same
underlying markets as the existing ETCs, this implies that the liquidity of Short
ETCs will also be similar. In addition to liquidity on five European stock
exchanges, ETF Securities can issue $250 million of additional new Leveraged
ETCs each day. In total, ETF Securities can create over $1 billion of new ETCs on
a daily basis across its range of over 110 ETCs. The minimum investment is one
ETC.
In total, ETF Securities now offer platforms of physically backed precious metal
ETCs and Classic, Forward, Short and Leveraged ETCs providing exposure to
energy, agriculture, livestock, industrial metals and precious metals. The ETCs
have been listed on five major European stock exchanges in dedicated ETC
trading segments.
First dealings in Leveraged ETCs commence on the London Stock Exchange
today.
Commenting on the listing of another world first, Graham Tuckwell,
Chairman of ETF Securities, said:
“We have seen unrivalled support and demand for ETCs. Since we listed the
Short ETCs two weeks ago, we have been inundated with calls for these new
Leveraged ETCs. Investors are now realising that commodities can offer benefits
to a portfolio due to their low correlation to equities. In times like these where
liquidity is tight, Leveraged ETCs can provide these diversification benefits with
50% less capital. In times of economic or financial upheaval, many independent
studies have shown that commodities can benefit a portfolio by lowering volatility
and/or increasing returns.
“Over the past thirteen weeks there has been a huge surge in global demand for
ETCs and we recently passed the landmark of $5.1 billion invested in our existing
offering. Over this period, assets and trading volumes are up approximately
150%. With listings on five of Europe’s major exchanges ETF Securities has
successfully delivered simple, cost-efficient and accessible products for all
investors.”
Commenting on the launch Pietro Poletto, Head of ETF and ETC Markets
at London Stock Exchange Group, said:
“These new Leveraged ETCs are a very welcome new addition to our
markets, and with the recently launched Short ETCs will take the number of
trading products available on our Exchange Traded Commodities market segment
to well over 100.
“As well as being able to access a broad range of commodities, including for the
first time Cocoa, Lead and Tin, investors will now have a simple way to gain
short and leveraged ETC exposure, putting some of the types of trading
strategies at use in the equities markets at their fingertips.
I am sure that this additional flexibility will contribute to the growth in our
dedicated Exchange Traded Commodities segment, which has started the year
very strongly, with £1.3 billion worth of trading in January, nearly double the
previous monthly record”
Risk warning: Investment in Short and Leveraged Commodity Securities involve
additional risks to those associated with the Issuer’s existing Commodity
Securities offering. Your particular attention is referred to the Risks and Warnings
Section of the Short and Leveraged Commodity Securities Prospectus.
For further information, please contact:
Roman Townsend
Penrose Financial
Tel: +44 (0) 20 7786 4875
Notes to editors:
The management of ETF Securities Limited pioneered the development of
Exchange Traded Commodities (ETCs), in 2003. Building on its success ETF
Securities created the world’s first entire ETC platform which was listed on the
London Stock Exchange in September 2006. Since then, ETF Securities has listed
its ETCs on Europe’s major exchanges (Frankfurt, Paris, Amsterdam and Italy)
with each exchange creating a separate ETC segment. With Classic, Forward,
Short and Leveraged ETCs available, investors can execute most trading and
investment strategies previously not possible.
To learn more about ETF Securities go to: www.etfsecurities.com
This advertisement does not constitute or form part of any offer or invitation to sell or issue, or any
solicitation of any offer to purchase or subscribe for, any transferable securities to be issued by ETFS
Commodity Securities Limited or any other securities, nor shall it or any part of it nor the fact of its
distribution form part of or be relied on in connection with any contract or investment decision relating
thereto. Any offer, invitation or solicitation shall be made solely by means of the relevant prospectus
and recipients of this advertisement who are considering a purchase of securities following distribution
of the prospectus in connection therewith are reminded that any such purchase should be made solely
on the basis of the information contained in such prospectus and any supplementary prospectus(es).
This advertisement does not constitute any recommendation regarding the securities of ETFS
Commodity Securities Limited.
The communication of this press release is not being made by, and this press release has not been
approved by, an authorised person for the purposes of section 21 of the Financial Services and
Markets Act 2000 (the “FSMA”). Accordingly this press release is not being distributed to, and must
not be passed on to, the general public in the United Kingdom. The communication of this press
release or any other document issued in connection with the offer and sale of the ETCs is only being
made to and directed at those persons in the United Kingdom falling within the definition of
Investment Professionals (as defined in Article 19(5) of the Financial Services and Markets Act 2000
(Financial Promotion) Order 2005 (the “Order”), or high net worth entities, and other persons to
whom it may otherwise lawfully be communicated, falling within Article 49(1) of the Order or any
person to whom it may otherwise lawfully be made (all such persons together being referred to as
“relevant persons”). The communication of this press release (or any other document issued in
connection with the offer and sale of the ETCs) must not be acted upon or relied upon by persons who
are not relevant persons. Persons distributing this press release must satisfy themselves that it is
lawful to do so. All applicable provisions of the FSMA must be complied with in respect of anything
done in relation to the ETCs in, from or otherwise involving the United Kingdom.
This is not an offer of securities for sale in the United States. Commodity Securities have not been
and will not be registered under the US Securities Act or any other applicable law of the United States.
Commodity Securities are being offered and sold only outside the United States to non-US persons in
reliance on the exemption from registration provided by Regulation S of the US Securities Act. The
Issuer has not been and does not intend to become registered as an investment company under the
Investment Company Act and related rules. Commodity Securities and any beneficial interest therein
may not be reoffered, resold, pledged or otherwise transferred in the United States or to US persons.
If the Issuer determines that any Security Holder is a Prohibited US Person (being a US Person who is
not a "qualified purchaser" as defined in the Investment Company Act), the Issuer may redeem the
Commodity Securities held by that Security Holder in accordance with the provisions described in the
Prospectus. Commodity Securities may not be purchased with plan assets of any "employee benefit
plan" within the meaning of section 3(3) of the United States Employee Retirement Income Security
Act of 1974, as amended ("ERISA"), any "plan" described in section 4975(e)(1) of the United States
Internal Revenue Code of 1986, as amended (the "Code") or any entity whose underlying assets
include "plan assets" of any of the foregoing by reason of an employee benefit plan's or other plan's
investment in such entity, which employee benefit plan, plan or entity is subject to Title I of ERISA or
section 4975 of the Code or any United States Federal, state, or local law or non-United States law
that is substantially similar to the prohibited transaction provisions of section 406 of ERISA or section
4975 of the Code (any such employee benefit plan, plan or entity, a "Prohibited Benefit Plan
Investor"). If the Issuer determines that any Security Holder is a Prohibited Benefit Plan Investor, the
Issuer may redeem the Commodity Securities held by that Security Holder in accordance with the
provisions described in the Prospectus."
“Dow Jones,” “AIG®” “Dow Jones-AIG Commodity IndexSM,” “DJ-AIGCISM”, “Dow Jones-AIG
Commodity 3-Month Forward Index” are service marks of Dow Jones & Company, Inc. and American
International Group, Inc. (“American International Group”), as the case may be, and will be licensed
for use for certain purposes by ETF Securities Ltd. ETCs based on the DJ-AIGCISM or related or other
sub-indices (including single commodity sub-indices) or 3-Month Forward Indexes are not sponsored,
endorsed, sold or promoted by Dow Jones, AIG Financial Products Corp. (“AIG-FP”), American
International Group, or any of their respective subsidiaries or affiliates, and none of Dow Jones, AIGFP,
American International Group, or any of their respective subsidiaries or affiliates, makes any
representation regarding the advisability of investing in such product(s).
To obtain a copy of the prospectus please visit the website at
www.etfsecurities.com
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