Tradeweb Introduces Mortgage-Backed ‘Covered’ Bonds

Tradeweb said it plans to introduce an online marketplace for

Tradweb, an over-the-counter multi-asset class online marketplace owned jointly by Thomson Reuters and 10 global dealers, said the online covered bond marketplace in the U.S. will enable institutional clients to access the same level of price transparency that can be found on Tradeweb’s other marketplaces, as well as the ability to electronically execute and process trades.

Covered bonds are debt securities backed by cash flows from mortgages or other loans. The assets remain on the issuer’s consolidated balance sheet and investors have recourse to a pool of assets that secures or “covers” the bond if the originator becomes insolvent, a release explained.

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Tradeweb said covered bonds enable mortgage providers to enhance their liquidity and funding positions. The market provides an effective means of funding diversification, as well as the opportunity to reduce the cost of funding through the issuance of higher-rated covered bonds.

The company said the decision to provide the new marketplace was made at the encouragement of the U.S. Treasury, as well as Tradeweb’s dealers and institutional clients.


More information is available at www.tradeweb.com.

ETF Assets Drop in June

The combined assets of the nation's exchange-traded funds (ETFs) were $578.07 billion in June, dropping 5.3%, according to the Investment Company Institute (ICI).

That was a reversal of the trend in May, where ETF assets rose by 2.4% (see ETF Assets Up Almost 26% in Last Year). Even with that reversal, over the past 12 months, ETF assets increased $92.14 billion, or 19.0%, according to the ICI. Assets in domestic equity ETFs increased $53.45 billion since June 2007, and global equity ETFs assets rose $19.33 billion during this period.

Assets in domestic equity ETFs increased $53.45 billion since June 2007, and global equity ETFs assets rose $19.33 billion during this period. Assets of bond funds were $45.09 billion and hybrid funds were $176 million.

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During June, the value of all ETF shares issued exceeded that of shares redeemed by $10.34 billion. In June 2007, ETFs experienced a net issuance of $5.30 billion.

A study released in June by State Street found that financial advisers see ETFs as the most innovative investment vehicle of the last two decades. A notable portion of advisers (43%) said 401(k)s are the most important growth area for these vehicles (see Advisers Report ETF Uptake).


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