Boost ETP, a specialist provider of short and leveraged exchange-traded products and a subsidiary of WisdomTree Europe, has revealed that trading volumes across its platform hit a record of $518 million in January 2015, equating to a notional volume exceeding $1.5 billion.
Notional trading volumes on the Boost ETP platform surpassed $1.5 billion in January 2015.
The new record comes against the backdrop of a rise in market volatility and increasing concerns over the robustness of spread betting and CFD firms, a few of which have entered administration or frozen client accounts in recent months.
Trading volumes on the platform have been on a clear growth trend, more than tripling over the past six months. As January closed, Boost reached a record of $201 million in assets under management, or $592m in notional terms.
The growth in trading volumes and AUM reflects both individual Boost successes – its range of short and leveraged oil and natural gas ETCs are now the most liquid in Europe – and favourable industry tailwinds as listed ETPs take market share from other product types such as CFDs, spread bets, warrants, certificates and structured products.
ETPs are widely seen as preferable to leveraged alternatives from a counterparty risk management perspective, owing to their collateralised structures and exchange-traded transparency. Ultimately, investors cannot lose more than their original investment in an ETP or face their positions being closed automatically due to margin requirements.
Since their debut in late 2012, Boost has continued to roll out new products and now offers ETPs covering all the major indices across equities, commodities, fixed income and currencies, having recently launched 3x short and 3x leveraged fixed income ETPs and also a 5x short and 5x leveraged EUR-USD ETP. Their product range now totals 95 listings across the LSE, Borsa Italiana, and Xetra exchanges.
Nik Bienkowski, Co-CEO of WisdomTree Europe, parent of Boost, commented: “The 87% growth in AUM and 266% growth in trading volumes in Boost ETPs over the past 6 months is very impressive. It clearly shows that investors have a strong appetite for robust and transparent short and leveraged investment vehicles. With increased volatility and the recent float of the Swiss Franc versus the Euro, Boost’s collateralised structure continues to shine above other product structures.”
He added: “Having launched the platform in December 2012, Boost now boasts the most liquid short and leveraged platform in Europe for trading oil and natural gas. With the recent crash in oil prices from $98/bl to $48/bl over the past 6 months, our clients were at first looking to profit from falling oil prices, however more recently, renewed interest in 3x leveraged oil appears to indicate that investors are becoming less bearish.”
