The NASDAQ OMX Group, Inc. (Nasdaq:NDAQ) today announced that The NASDAQ Stock Market(r) (NASDAQ(r)) has listed a new exchange traded fund (ETF) sponsored by Invesco PowerShares Capital Management LLC -- a leading provider of ETFs. NASDAQ is the most liquid U.S. market for ETFs, capturing 35.7% of all U.S. ETF volume in May. Average daily matched share volume was 320 million, more than any other U.S. exchange.
The Invesco PowerShares-sponsored ETF is trading on the NASDAQ ETF Market. This market is designed specifically to support ETFs and Index Linked Notes (ILNs) during their critical period of incubation and further strengthen NASDAQ's leadership position in the U.S. ETF sector.
Effective today, NASDAQ listed the PowerShares MENA Frontier Countries Portfolio (Nasdaq:PMNA).
The PowerShares MENA Frontier Countries Portfolio is based on the NASDAQ OMX Middle East North Africa Index(sm). This Index is designed to measure the performance of the largest and most liquid securities of companies domiciled in Middle Eastern and North African that have smaller economies or less developed capital markets than traditional emerging markets. The Index currently includes securities domiciled in Bahrain, Egypt, Jordan, Kuwait, Lebanon, Morocco, Oman, Qatar, and the United Arab Emirates (UAE).
"This PowerShares ETF is trading on a market that is designed specifically to provide new ETFs with very high levels of visibility and liquidity during their initial listing period," stated John Jacobs, executive vice president, NASDAQ OMX Global Financial Products. "Because of its unique electronic model, The NASDAQ ETF Market helps all newly NASDAQ-listed ETFs develop into established products and is instrumental in the overall growth of ETF trading in the U.S."
The focus of The NASDAQ ETF Market is the Designated Liquidity Provider, a Market Maker who has been selected to maintain liquidity in qualified ETFs (i.e., Qualified Securities). NASDAQ requires Designated Liquidity Providers to maintain a higher standard of market quality measured by spread, depth, and time quoting at or near the National Best Bid and Offer (NBBO). They receive price incentives to support ETFs during their period of initial listing, when ETFs need to develop more active trading.
Designated Liquidity Providers are selected by NASDAQ based on factors including experience with making markets in ETFs and ILNs, adequacy of capital, willingness to promote NASDAQ as a marketplace, issuer preference, operational capacity, support personnel, and history of adherence to NASDAQ rules and securities laws.
The NASDAQ ETF Market allows the traditional floor-based specialist, which has historically provided initial liquidity to new ETFs, to play a similar role by placing two-sided quotes in the NASDAQ Market Center. This enables ETF sponsors to continue to have the ability to develop "preferred" relationships with intermediaries. ETF issuers may choose a single Designated Liquidity Provider or multiple, competing liquidity providers. This flexible structure enables ETF issuers and traders to interact based on the needs of the issuer as they vary throughout the life cycle of the ETF.
NASDAQ OMX is a leading index calculator, designer and creator of some of the world's most popular ETFs, including PowerShares QQQ(tm) (Nasdaq:QQQQ) -- one of the most heavily traded listed equity securities in the U.S. and one of the most active ETFs in the world. PowerShares QQQ is designed to correspond to the price and yield performance of the NASDAQ-100 Index(r), the basis of more than 500 investment products in more than 36 countries.