BNP Paribas, one of the world's largest banking groups, lists a range of Exchange Traded Notes (ETNs) on the JSE. These ETNs will offer South African investors greater opportunities to diversify their investment portfolios through offshore exposure.
ETNs are transparent, liquid instruments aiming to provide simple and cost-effective exposure to assets that are traditionally difficult to gain exposure to as an individual investor. They are convenient building blocks for portfolio allocation according to individual market views.
By having the ETNs listed on the exchange African investors are able to buy and sell them through a registered stockbroker, just like any other JSE-listed instrument. The listing of the new ETN range brings the number of ETNs listed on the JSE to 28.
"We are pleased to have partnered with BNP Paribas to offer investors a broader range of equity products and allow them opportunities to diversify their portfolios through the JSE," says Leanne Parsons, Director of the Equity Market at the JSE.
"The Guru investment methodology is simple and completely objective, aiming to achieve an optimal investment solution. We are giving clients access to a "back to basics" approach, relying on investment techniques used by some of the most successful fund managers - such as Benjamin Graham, Warren Buffet and Peter Lynch", says Guillaume Dolisi, who created the Guru strategy at BNP Paribas.
The new products that will be listed include the Guru US ETN, the Guru Europe ETN, the Guru Asia ETN and the Guru Equity World ETN. They are denominated and traded in Rands while retaining the exposure to the corresponding offshore currency in addition to the underlying equity exposure.
This new range of ETNs tracks the performance of BNP Paribas' THEAM Quant Equity Guru funds in each region. The Guru strategy is a systematic investment methodology combining the respective strengths of active and passive investment management. The methodology implements the basic rules of active investment via stock selection based on value, profitability and prospects. In line with a passive investment approach, these indicators are monitored systematically according to clearly defined rules and rebalanced monthly. Companies are selected from an investment universe of over 2,500 companies.