NYSE Euronext announces that all ETFs traded on the NYSE Euronext Paris market of reference are, since 1st March 2010, eligible to .…
the Deferred Settlement Service (SRD), this amounts to a total of 369 products versus 147 previously.
Thanks to this evolution, investors, especially private investors, now have access to a broader scope of SRD eligible ETFs. They now have access to all Paris traded ETFs with leverage in a regulated and secure environment. Beyond its performance increasing effect, using the Deferred Settlement service, when trading ETF, is an efficient portfolio diversifier.
These newly eligible ETFs will not be admitted to trading on NYSE Euronext’s centralised borrowing and lending market. This category of assets that are eligible to the SRD but not available for trading on the borrowing and lending market, is named “eligible to the SRD, long only”. However investors will be able to benefit from all the advantages offered by the SRD on all the ETFs traded on NYSE Euronext Paris market of reference according to the rules applied by their financial intermediary.
Pedro Fernandes, European Head of ETFs for NYSE Euronext, comments : « This evolution offers investors the unique opportunity to link the advantages of ETFs to that of the Deferred Settlement Service, notably the efficient access with leverage to a broad range of asset classes within a secured regulated environment”
Alicia Suminski, Head of Business Development, European Cash markets for NYSE Euronext, explains: «We are studying carefully the SRD in order to improve its efficiency and to ensure it meets investor needs. The SRD has a long track record since its inception in 2000 and continues to be a much appreciated investment tool for private investors. »
On NYSE Euronext in Europe, 469 ETFs are listed by 16 different issuers on more than 300 indices. ETFs offer exposure to a broad range of asset classes and investment strategies (Equity, Fixed Income, Commodities, Short, Leverage, etc…).
Note :
The Deferred Settlement Service is a mechanism which allows an investor to take a leveraged position. The investor identifies his order when passing it to his financial intermediary as being SRD. The intermediary then immediately routes this order to the regulated market where it is executed and then settled as all other transactions three days after the transaction date. The intermediary finances his client’s position up to the end of the month when the investor receives the balance of his positions in his account. The leverage is the result of the cover ratio that the investor has to put towards his position at the time of the initial transaction (this varies from 20% to 40% depending on the type of collateral used)
Source: ETFWorld – NYSE Euronext
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