Europe’s first 3x Leverage ETP tracking the front-month Long-Gilt futures to be listed on LSE……
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The launch comes on the back of Boost Gilts 10Y 3x Short Daily ETP (3GIS) in August
Leveraged ETPs account for 53% of global AUM for Short and Leverage ETPs (1)
Global demand for S&L products continues to grow, with $61bn in AUM (October 2014) (2)
BOOST ETP, A WisdomTree Company announces that it has listed Europe’s first ever 3x leverage Gilts 10Y Fixed Income ETP (3GIL) on the London Stock Exchange (LSE). This is also Europe’s first 3x leverage Fixed Income ETP to be listed on any European Exchange. 3GIL is BOOST’s third 3x Sovereign debt S&L ETP to be listed on the LSE. The two current ETPs listed on the LSE are Boost US Treasuries 10Y 3x Short Daily ETP (3TYS) and Boost Gilts 10Y 3x Short Daily ETP (3GIS).
BOOST’s new 3x leverage fixed income ETP listed on the LSE is:
Boost Gilts 10Y 3x Leverage Daily ETP
The new ETP will track an index which gives exposure to the returns from holding an investment in the Long Gilt Rolling Future Index, which tracks front-month Long-Gilt futures, plus the interest revenue earned on the collateralised amount. The ETP is designed to return 3x the daily movement of the relevant benchmark index. For example, if the Long Gilt Rolling Future index rises by 1% on a day, then “3GIL” will rise by 3% on that day (less fees and adjustments). Conversely, if the Long Gilt Rolling Future index falls by 1% on a day, then “3GIL” will fall by 3% on that day(less fees and adjustments).
Hector McNeil, Co-CEO of WisdomTree Europe, commented: “We are very pleased to bring Europe’s first 3x leverage Fixed Income ETP, 3GIL, to Europe. Along with the recently listed Boost Gilts 10Y 3x Short Daily ETP (3GIS), the two ETPs provide investors the ability to trade both rising and falling Bank of England interest rates. With increasing uncertainty around Bank of England rate rises and the timing of those actions, 3GIL and 3GIS are ideal tools for investors to hedge their Sovereign Bond risks.”
By having both the 3x short and 3x leverage versions of UK Gilts means that investors can now access the full benefits of S&L ETPs.
These benefits and uses include:
The ETPs trade and settle the same as equities
Investors can treble their daily returns of their investment (less fees and adjustments) or use less capital to achieve the same exposure as a delta 1 ETF
Investors can hedge existing positions in one simple trade
Investors can use in a long or short strategy to take advantage of any rises or falls in the market
BOOST ETPs can be used in a pairs trade to take advantage of undervalued assets
Investors can get short the market/asset class quickly, efficiently and cheaply
BOOST’s S&L ETP platform now covers the world’s major asset classes, which include equities, fixed income and commodities.
1) October 2014 – Short & Leveraged ETFs/ETPs Global Flows Report
2) October 2014 – Short & Leveraged ETFs/ETPs Global Flows Report