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BOOST launches 12 3x Short & 3x Leverage ETPs in Germany


BOOST ETP has listed eight S&L commodities and four S&L United States Large Cap equity ETPs on Deutche Boerse’s Xetra ETP platform. This brings BOOST’s ETP product range to a total of 18 listings in Germany.

Demand for transparent, liquid and robust S&L ETPs has increased over the past few years with global S&L ETP assets rising to circa. $61bn (BOOST Short & Leveraged ETFs/ETPs Global Flows Report, October 2014) as many financial markets have trended sideways, resulting in volatile but poor long term returns. Investors have increasingly needed to focus on tactical and hedging opportunities to ensure they preserve and grow their capital.

BOOST’s 12 new ETPs are designed to return 3x the daily movement, long or short, of the relevant benchmark index. For example, if Gold rises by 1% on a particular day, then ‘PCFP’ (DE000A1ZLCQ2) will rise by 3% and ‘PCFN’ (DE000A1ZLCP4) will fall by 3%. However, if Gold falls by 1% then ‘PCFP’ (DE000A1ZLCQ2) will fall by 3% and PCFN’ (DE000A1ZLCP4) will rise by 3% (less fees and adjustments).

During the month of October, BOOST ETPs experienced record monthly trading volumes since their inception nearly 2 years ago. BOOST ETPs traded approximately US$280 million in October (equal to a notional traded value of approximately $800 million) with AUM reaching nearly $160 million (equal to a notional AUM value of approximately $450 million). This was due to heightened volatility in financial markets. The VIX rose to a high of 26.25 in October, the highest level since January 2012. 

BOOST has worked hard to develop its educational materials to help investors better understand the structure, benefits and risks of S&L ETPs/ETFs. Educational tools include the ‘Adviser/Investor Tool Kit’ which includes a Tutorial and Test, a Returns Simulator and various fact sheets and FAQs. BOOST also provides regular conference calls and face to face educational opportunities for investors.

Hector McNeil, Co-CEO of WisdomTree Europe, says: “We are very pleased to treble our ETP offering in Germany from six products to 18. In addition, we are also listing our first commodity ETPs to sit along-side our current equity and fixed income ETPs. We are also very proud to be the first provider of 3x short and 3x leverage ETPs tracking NASDAQ 100 and US Large Cap equities. Germany is Europe’s most important ETP market and also the largest short and leverage market in terms of Assets Under Management and trading volumes. German investors clearly have a significant appetite for the S&L ETP structure and we hope we can be the thought leaders in this space.

“Going forward we expect to expand our marketing and product development strategies in Germany significantly. We will be hosting and participating in a number of educational conferences and also adding significant content to our website. We also expect to continue adding new product and leading the innovation in this space.”

Viktor Nossek, Director of Research at WisdomTree Europe, says: “The sharp correction in energy commodities in October drove S&L investors to take contrarian positions and reinforce their bullish positioning on oil and natural gas. Net inflows totalled $318 million into oil and natural gas ETPs combined spiking volatility in energy and precious metals typically give strategic investors and excuse to sell, but for S&L investors, it is yet another opportunity to go long.”

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