
ETF Securities Ltd, the world pioneer of Exchange Traded Commodities (ETCs), is planning shortly to list a record 31 separate ETCs, comprising of 21 individual securities and 10 index securities, on Euronext Paris. This simultaneous listing on Euronext Paris will enable investors to trade such an expansive range of commodities through ordinary brokerage accounts just like any equity.
Investors will gain easy access to all of the key commodity groups, energy, agriculture, livestock, precious metals, industrial metals, without having to engage in the trading or management of future contracts; 29 of the ETCs are simply priced off DJ-AIG Commodity Indices, with the other 2 ETCs priced directly off oil futures.
The 21 separate classes of commodity securities to be listed are:
ETFS Aluminium
ETFS Brent Oil
ETFS Coffee
ETFS Copper
ETFS Corn
ETFS Cotton
ETFS Crude Oil
ETFS Gasoline
ETFS Gold
ETFS Heating Oil
ETFS Lean Hogs
ETFS Live Cattle
ETFS Natural Gas
ETFS Nickel
ETFS Silver
ETFS Soybean Oil
ETFS Soybeans
ETFS Sugar
ETFS Wheat
ETFS WTI
ETFS Zinc
The 10 baskets of commodities indices will be:
ETFS All Commodities DJ-AIGCISM
ETFS Agriculture DJ-AIGCISM
ETFS Energy DJ-AIGCISM
ETFS Ex-Energy DJ-AIGCISM
ETFS Grains DJ-AIGCISM
ETFS Industrial Metals DJ-AIGCISM
ETFS Livestock DJ-AIGCISM
ETFS Petroleum DJ-AIGCISM
ETFS Precious Metals DJ-AIGCISM
ETFS Softs DJ-AIGCISM
The listing is in response to the overwhelming interest that European investors have shown in ETFs and now ETCs. Similar to Exchange Traded Funds, ETCs are liquid, accessible and simple. The Euronext Paris listing follows the successful launch of the ETCs on Euronext Amsterdam late last year. Since September 2006, assets under management on these 31 ETCs have increased by over 160% to US$400 million. The rapid growth in assets highlights the investor demand for easy access to new asset classes.
ETCs are open-ended securities which can be bought and sold intraday by investors on a regulated exchange in the same way as any equity. They provide accurate and transparent commodity exposure to recognised benchmarks in a single trade. Investors can buy and sell the new ETCs through regulated brokers. ETCs can be traded with all the same order types available to equities, including market, limit and stop orders. The ETCs will be priced and settled in Euros. Like an Exchange Traded Fund, they can be created and redeemed on a continuous basis by the Authorised Participants, who ensure minimum applications up to a total of US$600 million daily across the 31 ETCs. It is expected that at least three market makers willprovide prices on the exchange, ensuring efficient and transparent pricing and market liquidity.
Announcing the listings Nik Bienkowski, Head of Listings at ETF Securities Limited, said: "We are delighted to offer this pioneering investment to investors and traders on Euronext Paris. Following our recent successful launches of our range of ETCs in Europe, we saw listing on Euronext Paris as the next logical step. "We designed ETCs to be simple and secure, open-ended securities. They have lowered many of the barriers that previously prevented some investors from investing directly in commodities, which include access, trading and operational risks, custody, and transaction costs. ETCs also provide a pure way of tracking a commodity rather than trying to replicate exposure by trading shares of commodity companies - many of which do not correlate to the underlying commodity, if available at all.
"The new securities track indices created by Dow Jones Indexes and AIG and each individual commodity index tracks a designated futures contract and is designed to reflect the returns from investing in commodities."Â
Commenting on the forthcoming listings, Alicia Suminski, Product manager, warrants, certificates and ETCs, Euronext said: "Following ETF Securities initial listing of Exchange Traded Commodities on Euronext Amsterdam in 2006, Euronext is delighted to be able to extend access to this innovative product range to investors in France. Thanks to the addition of the ETCs, Euronext's products range has been deepened, thus offering a wide
variety of trading opportunities to the investors."Â -- www.euronext.com
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