ETF Wolves in Sheep’s Clothing: Financial advisors are increasingly using passive, index-tracking ETFs to implement strategies that are just as active as what you’d find in the most aggressive mutual funds

SATURDAY, JULY 27, 2013

Wolf in Sheep’s Clothing

By CORRIE DRIEBUSCH | MORE ARTICLES BY AUTHOR

Financial advisors are increasingly using passive, index-tracking ETFs to implement strategies that are just as active as what you’d find in the most aggressive mutual funds.

Some pairings just make sense — Scarlett and Rhett, peanut butter and jelly, exchange-traded funds and index investing. But when the pairing is put into a different context — a campy musical version of Gone with the Wind, or a PB&J-filled breakfast cereal — it becomes a distinctly different thing. And that “different thing” is happening in the world of ETFs. Financial advisors are increasingly using passive, index-tracking ETFs to implement strategies that are just as active as what you’d find in the most aggressive mutual funds. For some investors, it’s a natural fit. But for others, particularly those drawn in by the allure of passive ETFs, it’s going to be stomach-churning. Read more of this post

A Race to Save the Orange by Altering Its DNA

July 27, 2013

A Race to Save the Orange by Altering Its DNA

By AMY HARMON

CLEWISTON, Fla. — The call Ricke Kress and every other citrus grower in Florida dreaded came while he was driving. “It’s here” was all his grove manager needed to say to force him over to the side of the road. The disease that sours oranges and leaves them half green, already ravaging citrus crops across the world, had reached the state’s storied groves. Mr. Kress, the president of Southern Gardens Citrus, in charge of two and a half million orange trees and a factory that squeezes juice for Tropicana and Florida’s Natural, sat in silence for several long moments. “O.K.,” he said finally on that fall day in 2005, “let’s make a plan.” In the years that followed, he and the 8,000 other Florida growers who supply most of the nation’s orange juice poured everything they had into fighting the disease they call citrus greening. To slow the spread of the bacterium that causes the scourge, they chopped down hundreds of thousands of infected trees and sprayed an expanding array of pesticides on the winged insect that carries it. But the contagion could not be contained. Read more of this post

Volatility Hits Hong Kong Exchange Fund with $3.25 billion investment losses in the second quarter; De facto central bank sees “immense shocks” ahead

July 26, 2013, 8:40 a.m. ET

Volatility Hits Hong Kong Exchange Fund

De facto central bank sees “immense shocks” ahead

CHESTER YUNG

HONG KONG—Hong Kong’s de facto central bank suffered an investment loss of 25.2 billion Hong Kong dollars (US$3.25 billion) in the second quarter, due to declines in the value of its bond holdings and foreign-exchange losses during a period of heightened market volatility. The Hong Kong Monetary Authority’s Exchange Fund lost 19.6 billion Hong Kong dollars on its bond holdings during the quarter, reversing a gain of 2.8 billion Hong Kong dollars in the first quarter. It also lost 6.1 billion Hong Kong dollars on local equities as the benchmark Hang Seng Index fell 6.7%, while losses from foreign-exchange movements totaled 5.9 billion Hong Kong dollars. The HKMA uses the fund to manage its assets and maintain the Hong Kong dollar’s peg to the U.S. dollar, as well as to ensure the territory’s financial stability. Read more of this post

Foreign banks in China dropping out of retail banking

Foreign banks in China dropping out of retail banking

Staff Reporter

2013-07-28

Due to adjustment in business structure and continuing deficits, a number of foreign banks have started closing their retail banking branches in China. In mid-July, Deutsche Bank China folded its last retail banking branch in Huamao, Beijing. According to the Beijing Business Today, the the bank closed the branch, opened on Nov 29, 2007, after deciding to focus on corporate banking, forgoing its original ambition to diversify its services. Deutsche Bank is not the first foreign bank exiting the retail banking market in China. Previously, the Royal Bank of Scotland left the retail banking sector in order to concentrate its resources on corporate and wholesale banking. The Bank of East Asia (China) has also pulled out of the retail banking business for some of its smaller branches, according to Beijing Business Today. Read more of this post

Blown it: China’s offshore wind farms suffer repeated setbacks

Blown it: China’s offshore wind farms suffer repeated setbacks

Staff Reporter

2013-07-28

In 2010, the Chinese government successfully held public bids for the nation’s first four offshore wind farm projects, all off the coast of Jiangsu province, but three years on,the four projects have yet to break ground due to a number of factors, including difficulties in the coordination for the use of the sea area, an unclear power-rate policy, the immaturity of peripheral industrial chain and a protracted approval process. “The progress of the project is slower and the time for approval longer than expected,” an executive of one of the bid-winning enterprises has admitted. Read more of this post