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BM&FBOVESPA has announced that as of August 2, 2010 the round lot for index funds or ETFs (Exchange Traded Funds) will be reduced from 100 units to 10 units, which means that the minimum value needed to invest in this product will be ten times less than it was. For example, a round lot for the ETF BOVA11, which mirrors the Bovespa Index, based on its closing price on July 19, would be reduced from BRL6,280.00 to BRL628.00. The objective of this round lot reduction is to increase the trading potential of these funds especially for individual investors.
ETFs are funds which mirror indexes and their units are traded on the Exchange just like shares. When investors buy the units of any given ETF, they become holders of all the component shares of the index which that ETF replicates without having to buy the shares of each company in the index separately. As a result, ETFs provide investors with a fast, efficient and practical investment opportunity which also facilitates their ability to closely follow the performance of their investment in the respective index.
There are currently seven index funds (ETFs) trading at BM&FBOVESPA. Six are managed by BLACKROCK BRASIL and they are: BOVA11 (iShares Ibovespa Fundo de Índice), SMAL11 (iShares BM&FBOVESPA Small Cap Fundo de Índice), MILA11 (iShares BM&FBOVESPA MidLarge Cap Fundo de Índice), BRAX (iShares Índice Brasil IBrX-100 Fundo de Índice); CSMO (iShares Índice BM&FBOVESPA de Consumo Fundo de Índice); and MOBI (iShares Índice BM&FBOVESPA Imobiliário Fundo de Índice). The seventh, PIBB11 (PIBB Fundo de Índice Brasil - 50 - Brasil Tracker), is managed by Banco Itaú.
Calculation Simulation for the new round lot based on the latest trading prices:
|
|
Closing Price |
Current Round Lot |
New Round Lot as
of August 2, 2010 |
|
|
BOVA |
BRL
62.80 |
BRL
6,280.00 |
BRL
628.00 |
|
|
MILA |
BRL
43.34 |
BRL
4,334.00 |
BRL
433.40 |
|
|
SMAL |
BRL
59.57 |
BRL
5,957.00 |
BRL
595.70 |
|
|
BRAX |
BRL
39.54 |
BRL
3,954.00 |
BRL
395.40 |
|
|
CSMO |
BRL
28.01 |
BRL
2,801.00 |
BRL
280.10 |
|
|
MOBI |
BRL
18.81 |
BRL
1.881.00 |
BRL
188.10 |
|
|
PIBB |
BRL
85.65 |
BRL
8,565.00 |
BRL
856.50 |
|
Increase in the participation of individual investors
The total financial volume in June for the seven index funds (ETFs) currently traded at BM&FBOVESPA reached BRL 515.30 million, with 12,083 trades. The participation of individual investors in ETFs rose from 15.4% in May to 23% in June. Institutional investors continue to have the largest participation in ETFs with 40.4% of the total, followed by individual investors with 23%, financial institutions with 20.5%, foreign investors with 15.8% and government and private companies with 0.4%.
