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Boost’s ETPs hit record USD518m trading volume in January

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Boost’s ETPs hit a new record of USD518m in trading volume in January, adding up to a notional volume exceeding USD1.5bn. 

The new record comes against the backdrop of a rise in market volatility and increasing concerns over the robustness of spread betting and CFD firms, a few of which have entered administration or frozen client accounts over the past month.
 
Trading volumes in Boost’s platform have been on a clear growth trend, more than tripling over the past 6 months. As January closed, Boost reached a record of USD201m in AUM,[1] or USD592m in notional terms. This growth suggests that Boost S&L ETPs are not only becoming the product of choice among other ETPs, but also increasingly gaining market share against other product types such as CFDs, spread bets, warrants, certificates and structured products. ETPs lead the way in counterparty risk management offered through their collateral, and draw investor appeal due to their exchange-traded advantages, as well as their simplicity versus other leveraged offerings, since investors cannot lose more than their original investment in an ETP or face their positions being closed automatically due to margin requirements.
 
Boost’s growth has been driven by product innovation and a focus on proactively educating investors about the benefits and risks of using S&L ETPs. The many different investment strategies that investors can employ also add to the usefulness of the product. Boost now offers ETPs covering all the major indices across equities, commodities, fixed income and currencies, having recently launched 3x short and 3x leveraged fixed income ETPs and also a 5x short and 5x leveraged EUR-USD ETP. Boost ETP’s product range totals 95 listings on London Stock Exchange, Borsa Italiana, and Germany’s Xetra.
 
Nik Bienkowski, Co-CEO of WisdomTree Europe says: “The 87% growth in AUM and 266% growth in trading volumes in Boost ETPs over the past 6 months is very impressive. It clearly shows that investors have a strong appetite for robust and transparent short and leveraged investment vehicles.  With increased volatility and the recent float of the Swiss Franc versus the Euro, Boost’s collateralised structure continues to shine above other product structures.
 
“Having launched the platform in December 2012, Boost now boasts the most liquid short and leveraged platform in Europe for trading oil and natural gas. With the recent crash in oil prices from USD98/bl to USD48/bl over the past six months, our clients were at first looking to profit from falling oil prices, however more recently, renewed interest in 3x leveraged oil appears to indicate that investors are becoming less bearish.”
 
Viktor Nossek, Director of Research at WisdomTree Europe, says: “The sharp downward trajectory in oil since the summer of last year stood out as the main macro event underpinning commodities.  Investors would have benefited from using geared short ETPs tracking oil as a means to efficiently position bearishly around crude oil’s price slump.
 
“In December 2014 oil futures fell 20% and in January they fell by another 10%. Over the same period, BOOST WTI Oil 3x Short Daily ETP (3OIS) returned 167% (from 1 Dec 2014 to 30 Jan 2015), demonstrating once again that geared short ETPs are capital efficient investments in downward trending markets. Geared short ETPs can amplify returns of investors desiring opportunistic bearish positioning, as well as enabling them to build hedges to protect long positions over several weeks and even months to ride out the storm."

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