Reports

ETCs See Largest Inflows In Six Months - Report

Rachel Walsh 21 January 2009

ETCs See Largest Inflows In Six Months - Report

Net flows into all-long Exchange Traded Commodities rose by $216 million last week, the largest weekly rise since July 2008, reports ETF Securities. Oil and physically-backed gold ETCs accounted for 90 per cent of the increase with a diverse group of precious metals, agriculture and energy ETCs seeing the remainder of the inflows.

Long oil ETCs saw their strongest inflows ever, with total inflows rising by $147 million during the week. Total inflows have now increased by $583 million since the beginning of November, rising faster than any other commodity class.

ETFS Crude Oil is the most popular oil ETC, with total flows since inception standing at $329 million. Last week was its biggest week since listing in 2006 with $73 million of inflows, making it the most popular ETC last week.

ETFS WTI also saw strong inflows of $28 million followed by $22 million of inflows into ETFS Brent.

The report also notes that ETFS Leveraged Crude Oil saw $25 million of inflows last week, the largest weekly flow since listing in February 2008. It is now the most popular of the leveraged ETCs having pushed ETFS Leveraged Gold out of first place in the third week of December. ETFS Short Crude Oil saw continued outflows last week, with net flows now down $24 million since the beginning of November.

Physically-backed gold ETCs also continued to show very strong inflows last week, with Gold Bullion Securities receiving $52 million of inflows. Since the middle of November there has been a marked increase in interest in physically-backed gold ETCs with net inflows rising by $350 million. ETFS Physical Gold has seen $293 million of inflows over the period, accounting for 83 per cent of the physical gold inflows.

After oil and gold the largest inflows last week were into ETFS Physical Platinum with a $5 million increase, followed by ETFS Physical Silver with a $3 million increase. Other ETCs that have seen increased interest include ETFS Wheat, ETFS Soybeans, ETFS Livestock and ETFS Industrial Metals.

The management of ETF Securities created the world's first ETC in 2003 - Gold Bullion Securities in Australia and London - which now has approximately $2 billion in assets. In 2005, ETF Securities created the world's first oil ETC and in 2006 ETF Securities created the world's first ETC platform on the London Stock Exchange, making available 19 commodities and 10 indices. In 2007, ETF Securities launched its physically-backed precious metals ETC platform which made platinum and palladium available for the first time.

ETF Securities recently launched the largest platform of thematic sector ETFs in Europe providing exposure to coal, steel, shipping and nuclear power for the first time in the continent’s history.

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