WisdomTree Launches Unique Boost FTSE MIB Banks ETP

WisdomTree announced the listing of a Boost ETP, offering exposure to the Banks in the FTSE MIB…

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This ETP is the first of its kind, allowing investors to manage their exposure to a banking sector that is an important part of the Italian equity landscape. At the end of October, Banks represented the largest sector in the FTSE MIB with a weight of over 21%, while in the broader FTSE Italia All-Share indices, Banks had a weight of 19.3%.“We believe banks are an important part of the equity landscape in many European markets, especially in Italy where they remain the largest sector,” said Viktor Nossek, Director of Research. “The forthcoming referendum, while not directly focused on the banking sector, is likely to represent an opportunity for investors to consider allocating to this sector that is fundamental to the revitalisation of the domestic economy.”

“Managing political risk and being able to tactically position equity portfolios is one of the key lessons from referendums and elections in 2016,” said Nizam Hamid, ETF Strategist. “The FTSE MIB Banks 15% Capped Index has declined by close to 51%, for the year to the end of October since 31 December 2015, compared to a 20% decline for the FTSE MIB. This performance reflects the negative view on non-performing loans and the prospects for recapitalisation of the banking sector. The referendum represents an opportunity to revisit this challenge and this unique Boost ETP provides investors with a means of allocating to this sector in an efficient single product.”

The FTSE MIB Banks 15% Capped Index, reflects the constituents of the ICB Supersector of Banks from the FTSE MIB. In order to provide a suitably diversified index there is a 15% cap on individual constituents and as of the end of October 2016, there were nine constituents in the index. The index follows the calculation methodology and rules of the FTSE MIB index, including a quarterly reset of the 15% cap of single stock weights.

Stéphane Degroote, Head of ETFs & Derivatives Business EMEA, at FTSE Russell said: “We are delighted to have worked with Wisdom Tree in the development of their innovative new ETN. FTSE Russell continues to support its clients to meet investor demand for exposure to specific market segments, helping them to reach new markets and customers.”

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