Indexing trends in Europe and Asia
17 December 2012
News, Asia, Europe
By Asia Asset Management
Index provider S&P Dow Jones Indices provides a brief overview of the performances and latest trends over the last year, across the equity and commodity markets, with a focus on Europe and Asia.
In regards to equities, issuances of ETFs in Asia have been generally slow this year and have mostly focused on broad-based domestic equity indices. However, inflows in broad-based fixed income and/or international equities products have increased. In Europe, in addition to interest in enhanced beta indices, inflows into emerging markets indices have also garnered much enthusiasm, according to Daniel Ung, Associate Director, Index Research & Design, S&P Dow Jones Indices.
In the commodities space, investor inflow in both Europe and Asia have picked up in the last quarter despite a lethargic start to 2012, amidst concerns over European sovereign debt and sluggish growth in China. Unsurprisingly, the Fed’s announcement of QE3 also appears to have given some support to the commodity markets and inflows in precious metals, in particular gold and silver, have since picked up. Whilst static, broad-based indices remain the favourite vehicle through which investors obtain long exposure, there is also evidence of investor interest in more dynamic strategies, such as the DJ-UBS Roll Select Index. So far this year, the index has appreciated by 2.26% per annum, as a result of the divergent commodity forward curves reflecting differing expectations in the fundamentals and the strength of front month prices in Brent crude and agricultural products.
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