Welcome to SwitzerlandWelcome
Change Country
Please scroll down the disclaimer to enter the website
Please read the important information below before continuing to our website

Important information for qualified investors

By clicking on "Accept", you confirm that you have read, understood and agreed to the below terms of use.

Additionally, you confirm that you are a qualified investor within the meaning of Swiss collective investment schemes law with residence or domicile in Switzerland. Moreover, you acknowledge that certain funds referred to on this website may not be offered to investors in Switzerland who are not qualified investors within the meaning of Swiss collective investment schemes law.

If you are not a qualified investor within the meaning of Swiss collective investment schemes law with residence or domicile in Switzerland please contact the Swiss representative at

Roland Fischer - Société Générale Paris, Zurich Branch, Talacker 50, P.O. Box 1928, CH-8021 Zurich, Switzerland.

Telephon number: 058 272 33 44  

e-mail address: info@lyxoretf.ch

******

Financial services providers and investment professionals

By accessing this website and the products, services, information and material contained or described herein, you acknowledge your agreement with and understanding of the following terms of use:

Access restricted to qualified investors

The information on this website is exclusively directed at qualified investors within the meaning of the Federal Act of Collective Investment Schemes (CISA) and its implementing ordinance as well as according to the most recent interpretation of the Swiss Financial Market Supervisory Authority (FINMA).

The information on this website is exclusively directed at qualified investors with residence or domicile in Switzerland.

The following are considered qualified investors

Qualified investor: definition

Qualified investors within the meaning of Article 10 of the Swiss Federal Collective Investment Schemes Act of 23 June 2006 (“CISA”) and the Collective Investment Schemes Ordinance of 22 November 2006 (“CISO”) are essentially the following:

1.regulated financial intermediaries such as banks, securities traders, fund management companies and asset managers of collective investment schemes as well as central banks;

2.regulated insurance institutions;

3.public entities and retirement benefits institutions with professional treasury operations;

4.companies with professional treasury operations;

5.investors who have concluded a written discretionary management agreement with a regulated financial intermediary as defined in section 1 unless they have declared in writing that they do not wish to be deemed as qualified investors;

6.investors who have concluded a written discretionary management agreement with an independent asset manager, provided they have not notified in writing that they do not wish to be deemed as qualified investors and provided (i) the independent asset manager in its capacity as financial intermediary is governed by Article 2 para 3 (e) of the Anti-Money Laundering Act of 10 October 1997 (“AMLA”), (ii) the independent asset manager is governed by the code of conduct issued by a specific industry body, such code of conduct being recognized as the minimum standard by the Financial Market Supervisory Authority (FINMA), and (iii) the discretionary management agreement complies with the standards of a specific industry body, such standards being recognized as the minimum standard by FINMA;

7.high-net-worth individuals who have confirmed in writing to a financial intermediary pursuant to section 1, or to an independent asset manager that meets the requirements described in section 6, that they wish to be considered as qualified investors (“opting-in”) and that they (a) have the knowledge required to understand the risks of the investments based on their individual education and professional experience or based on comparable experience in the financial sector and hold assets of at least CHF 500,000 (b) hold assets of at least CHF 5 million;

8.independent asset managers who fulfill the requirements described in section 6, and confirm that they will use the information on this website that refers to investment funds not approved by FINMA exclusively for clients that are regarded as qualified investors.

Information on this website

This website is published by Lyxor Asset Management (Lyxor AM)

Société par actions simplifiée (simplified private limited company) with a capital stock of 161 106 300 euros as of November 5th, 2013

Nanterre Trade Register N° 418 862 215              

APE Number: 652E

Registered Office: Tours Société Générale, 17 cours Valmy, 92800 Puteaux

VAT No: FR 604 1886 2215

Responsibale person for the publication is: Lionel PAQUIN, CEO

Editing director: Nathalie BOSCHAT, Global Head Lyxor Communication (Tel.: +33 1 42 14 83 21; E-Mail: nathalie.Boschat@sgcib.com).

 

This website is hosted on the own servers of Société Générale.

This website is governed by French law.

Professional regulations

Lyxor AM is a French investment management company authorized by the Autorité des marchés financiers under the UCITS Directive (2009/65/CE) and the AIFM Directive (2011/31/UE). Lyxor AM is represented in the United Kingdom by Lyxor Asset Management UK LLP, which is authorized and regulated by the Financial Conduct Authority in the UK (FCA reference number 435658). Lyxor AM is a registered Commodity Pool Operator and a Commodity Trading Advisor under the U.S. Commodity Futures and Trade Commission. Lyxor AM is also a member of the National Futures Association.

The information on this website has been prepared for information purposes only and does neither constitute an advertisement or recommendation nor an offer or solicitation to purchase or sell investment instruments, to effect any transaction or to enter into any legal relations.

Although reasonable care has been taken to ensure that the information on this website is accurate, correct and complete, no guarantee, warranty or representation, express or implied, is given to the accuracy, correctness or completeness of the content of this website. Any information on this website may be subject to change or update without notice. Unless otherwise stated, the numbers/figures on this website are unaudited. Prices shown may not reflect the prices at which units/shares may be purchased or sold at any given time.

The entire information which may be accessed through this website is protected by copyrights and other intellectual property rights of companies which are affiliated to Lyxor Asset Management  or of third parties. Under no circumstances should this information or any part thereof be copied, reproduced or redistributed without prior authorization.

This website may contain hypertext links to websites or pages created and maintained by third parties which are not affiliated to Lyxor Asset Management. Activating such hypertext links may cause you to leave this website. Such addresses or hypertext links are provided solely for your convenience and information. Neither Lyxor Asset Management nor any other affiliate controls or reviews any of these websites and pages linked with or connected to this website and, accordingly, does not accept any liability for their contents, the offered products or services or any other offers. Using links from this website to any website not owned by companies which are affiliated to Lyxor Asset Management. is at your own risk. If you wish to create a hypertext link to this website from your site, you must request prior authorization from Lyxor Asset Management.

Fund documents/Legal information

Purchase orders for shares of our funds can be accepted on basis of the current legal documents only. The fund and share class specific Key Investor Information Documents (KIID), Prospectuses, Articles and Trust deeds as well as Annual and Semi-annual Reports of the funds referred to on this website may be obtained free of charge from

Swiss Representative:  Société Générale Paris, Zurich Branch, Talacker 50, P.O. Box 1928, CH-8021 Zurich, Switzerland.

Sales restrictions

The information on this website is exclusively intended for qualified investors with residence or domicile in Switzerland. The information on the financial products referred to in this website is expressly not directed to any person in or from any jurisdiction where the publication or availability of such products is prohibited (on grounds of residence, domicile, nationality or otherwise). Accordingly, the information contained herein does not constitute an act of distribution, an offer to sell or the solicitation of an offer to buy any securities to any person or entity in any jurisdiction in which such distribution or offer may not be lawfully made or access to such information is not permitted. Persons subject to local restrictions of this type must refrain from accessing this website. Investors should take advice from their own independent advisors before making an investment decision and should be aware of local laws governing investments. Without limiting the generality of the foregoing, the information in this website is not directed and not for distribution and does not constitute an offer to sell or the solicitation of any offer to buy any securities in the United States of America to or for the benefit of United States persons (being in particular nationals or residents of the United States of America or partnerships or corporations organized under the laws of the United States of America or any state, territory or possession thereof).

Not all of the funds accessible on this website are registered for distribution in or from Switzerland to non-qualified investors. The Swiss Financial Market Supervisory Authority (FINMA) publishes a list of foreign collective investment schemes which are registered for distribution in or from Switzerland on their website. Société Générale Paris, Zurich Branch, Talacker 50, P.O. Box 1928, CH-8021 Zurich, Switzerland., is the representative and paying agent in Switzerland of the funds which are registered for distribution in or from Switzerland and for non-registered funds that are distributed exclusively to qualified investors.

Past performance

Past performance is not a guarantee or a reliable guide to the future. Market and exchange rate movements may cause the capital value of investments, and the income from them, to go down as well as up and the investor may not get back the amount originally invested. Investments in emerging markets may result in higher risks and volatility due to political and economic instability and less developed markets and systems.

Subscriptions for investment in any fund mentioned on the website may only be made on the basis of the relevant prospectus, the simplified prospectus and the Key Investor Information Document ("KIID"), respectively, and the most recent annual financial statements (or semi-annual financial statements if published thereafter).

Privacy

We may collect information about you when you use this website, e.g. by sending cookies to your computer or if you provide us with certain information about yourself to register to access and use certain portions of this website. We use such information about you to verify your identity and eligibility to receive certain products or services, to provide information to you about products and services that we believe may be of interest to you, to record your interest in products and services that we offer, and to respond to your requests for information. We do not use for other purposes or disclose to any third party any personal information, except with your consent or as otherwise permitted or required by law. We maintain physical, electronic and procedural safeguards to guard your personal information and request from our employees to fully adhere to privacy standards, policies and the applicable laws. Please note that data that is transported over the Internet may be accessible to anybody. Your data may be lost during transmission or may be accessed by unauthorized parties. Neither Lyxor Asset Management  nor any other affiliate accepts any liability for direct or indirect losses as regards the security of your data during its transfer via Internet. Please use other means of communication if you think this is necessary or prudent for security reasons.

No warranty/No liability

The contents of this website are based upon sources of information believed to be reliable. Neither Lyxor Asset Management  nor any other affiliate makes warranty that access to the site will be uninterrupted or error-free, that defects will be corrected, or that viruses or other harmful components will not be transmitted in connection with your use of the website. Lyxor Asset Management  and their affiliates hereby expressly disclaim, to the fullest extent permitted by applicable law and/or regulation, all warranties, express, statutory or implied, regarding the website and any results to be obtained from the use of the website and its contents, including but not limited to all warranties of merchantability, non-infringement, fitness for a particular purpose or use and all warranties arising from course of performance, course of dealing and/or usage of trade or their equivalents under the applicable laws and/or regulations of any jurisdiction. Neither Lyxor Asset Management , nor any other affiliate warrants or guarantees the accuracy, timeliness, suitability, completeness, or availability of this website or the information or results obtained from use of it.

Under no circumstances and under no theory of any applicable law and/or regulation shall Lyxor Asset Management  or any other affiliate, their officers, directors or employees be liable to anyone for any damages arising in tort, contract, strict liability or otherwise from access to or use of the website or inability to access, regardless of whether they are direct, indirect, special, incidental, or consequential damages of any character, including damages for trading losses or lost profits, or for any claim or demand by any third party.

 I have read the terms set out above and confirm that I am a Professional Investor resident in Switzerland and wish to proceed

 

Accept

Please scroll down the disclaimer to enter the website
20 Apr 2018

What rising inflation means for your US investments


After a number of years in which central banks were more concerned with fighting the risks of deflation, several signs point to a higher inflation environment in the US. Over the last 12 months, oil prices have shot up by almost 30%. The US economy is now at "full" employment, with businesses reporting a shortage of skilled workers and an unemployment rate below 5%. Wage growth - initially sluggish - has also started to pick up in recent months, albeit without inducing major wage gains as yet.  According to OECD estimates, growth should remain above potential this year with the usage of industrial production capacity currently running at close to 80%. We believe such pressures in the productive apparatus will eventually translate into higher consumer prices.

Some of these effects are already apparent. For the first time in almost a year, headline inflation (CPI) and core inflation (which excludes volatile components such as energy prices) printed above the Fed’s 2.0% target in March. Higher inflation could well propel the push for higher speed policy normalisation. According to the March FOMC Minutes, Fed officials have grown more confident in the inflation outlook, barring the realisation of downside risks to their projections. Strong inflation reports in March and April should keep the Fed on track for a 25 basis points rate hike in June - and enable it to deliver four in total this year. However, we do not believe that the inflation rate will ramp up too dramatically in the period ahead. Technological developments in areas such as healthcare or communications, unconventional petroleum production and greater investment in productive capacities are factors that could counter at least some of the inflationary pressures.

 

US headline and core inflation both ahead of the Fed’s 2% target in March

                     chart 1 Us headline

Source: Lyxor International AM, Reuters Eikon Analytics.  Data as at 31 March 2018

Asset selection becomes more complicated

Despite the relatively benign nature of the above, investors are concerned by other issues. Asset allocation has become more complex given greater political risk (like the possible trade war between the US and China, less support from central banks and the high valuations most traditional asset classes are displaying. As a result, we expect to see a volatility regime shift, with markets much more volatile than they have been in recent years. Some of the market moves we’ve seen in February and March were, in our view, the precursors for this period of instability.

The positive correlation between the returns of fixed income and equity assets also impedes efforts to diversify portfolios more effectively. Historically, an investor who adopts a more cautious position tends to reduce their exposure to equities and increase their weighting to fixed income. That may not however be wise in a rising inflation environment where greater caution is required on conventional bonds. Inflation-linked bonds may be better suited to this new normal.


Right place, right time

Our research shows assets related to inflation tend to perform well in the more advanced stages of the economic cycle. The expansion in the US is undoubtedly entering old age - so the probability of a recession in the next two years is increasing. 

Holding commodities, most notably petroleum products, tends to prove beneficial in advanced stages of the cycle (especially 12 months before a recession), both in terms of absolute and risk-adjusted returns. The analysis takes into account economic cycles in the US, as measured by the NBER, since 1970. Inflation breakevens have been fairly supported by the recent move in energy/ oil prices (Brent above $72/bbl on 17 April). Net flows into short -dated TIPS ETFs have been fairly robust over the past month (despite net outflows in March in all-maturities ETFs). While energy price moves are difficult to predict in the near-term, the possibility of weather-related or geopolitically induced spike in oil prices remains. They should nonetheless continue to underpin perceptions of higher inflation. Inflation prints, on the other hand will continue to benefit from positive base effects (temporary slowdown in telecommunications and airfares in 2017) ahead of the summer. 


Key calls

For now then, we are looking to overweight assets such as TIPs and inflation breakevens, as well as commodities and those equity sectors that are most sensitive to inflation expectations.

In equities, as we said last week, Energy stocks offer a good proxy to oil prices and US inflation breakevens. The global energy sector offers an attractive dividend yield of around 3.75% (i.e. positive carry) vs. the negative carry of investing in futures-based strategies. The latter underperform when the futures curve is in contango (futures price above the expected spot price) - which is typically the case with Oil. Financials also remain a pure cheap way to play global reflation.

Whether you choose TIPs or breakevens depends on your view on where inflation goes next. TIPs are the conventional choice, but breakevens may be a better play if you believe people are underestimating just how high inflation could climb.

Energy stocks: a good proxy to US inflation breakevens

                        Chart 2 Energy stocks

Source: Lyxor International AM, MSCI, Bloomberg. Data as at 31 March 2018 


Why Lyxor for inflation

Lyxor has the most far reaching and complete range of inflation-linked ETFs in Europe, with exposures covering the US, Europe and the UK. Our Core US TIPS ETF is the cheapest on the market at just 0.09%. If you’re looking to not only protect yourself against rising inflation but also rising rates, our unique inflation expectations ETFs are designed to tackle both. With over 12 years’ experience managing inflation-related ETFs, and €3.3bn in AuM, look no further for dependable solutions to rising inflation.

Other ways to ride the inflation wave include investing in commodities, or targeting certain sectors. Our broad commodities ETF launched in 2006 tracks the Thomson Reuters/CRB index, a reference benchmark with over 50 years’ track record. It was the most widely traded broad commodities ETF in Europe over the past 5 years. We also offer 10 ways to access global equity sectors, with some of the oldest and largest ETFs of their kind in Europe. Our MSCI World Energy, Materials and Financials ETFs were the most efficient in the market over the past year.*

 

*Source: Lyxor International Asset Management. Data as at 31/01/2018. Statements refer to European ETF market. Efficiency data is based on the efficiency indicator created by Lyxor ‘s research department in 2013. It examines 3 components of performance: tracking error, liquidity and spread purchase/sale. Each peer group includes the relevant Lyxor ETF share-class and the 4 largest ETF share-classes issued by other providers, representing market-share of at least 5% on the relative index. ETF sizes are considered as an average of AUM levels observed over the relevant time period. Detailed methodology may be found in the paper ‘Measuring Performance of Exchange Traded Funds’ by Marlène Hassine and Thierry Roncalli. Statements refer to European ETF market. Past performance is no guide to future returns.

Risk Warning

THIS COMMUNICATION IS FOR ELIGIBLE COUNTERPARTIES OR PROFESSIONAL CLIENTS ONLY

Fund and charge data: Lyxor ETF, correct as at  20 April  2018.

This document is for the exclusive use of investors acting on their own account and categorized either as “Eligible Counterparties” or “Professional Clients” within the meaning of Markets in Financial Instruments Directive 2004/39/EC. These products comply with the UCITS Directive (2009/65/EC). Société Générale and Lyxor International Asset Management (LIAM) recommend that investors read carefully the “investment risks” section of the product’s documentation (prospectus and KIID). The prospectus and KIID are available free of charge on www.lyxoretf.com, and upon request to client-services-etf@lyxor.com.

The products mentioned are the object of market-making contracts, the purpose of which is to ensure the liquidity of the products on the London Stock Exchange, assuming normal market conditions and normally functioning computer systems. Units of a specific UCITS ETF managed by an asset manager and purchased on the secondary market cannot usually be sold directly back to the asset manager itself. Investors must buy and sell units on a secondary market with the assistance of an intermediary (e.g. a stockbroker) and may incur fees for doing so. In addition, investors may pay more than the current net asset value when buying units and may receive less than the current net asset value when selling them. Updated composition of the product’s investment portfolio is available on www.lyxoretf.com. In addition, the indicative net asset value is published on the Reuters and Bloomberg pages of the product, and might also be mentioned on the websites of the stock exchanges where the product is listed.

Prior to investing in the product, investors should seek independent financial, tax, accounting and legal advice. It is each investor’s responsibility to ascertain that it is authorised to subscribe, or invest into this product. This document is of a commercial nature and not of a regulatory nature. This material is of a commercial nature and not a regulatory nature. This document does not constitute an offer, or an invitation to make an offer, from Société Générale, Lyxor Asset Management (together with its affiliates, Lyxor AM) or any of their respective subsidiaries to purchase or sell the product referred to herein.

Lyxor International Asset Management (LIAM), société par actions simplifiée having its registered office at Tours Société Générale, 17 cours Valmy, 92800 Puteaux (France), 418 862 215 RCS Nanterre, is authorized and regulated by the Autorité des Marchés Financiers (AMF) under the UCITS Directive (2009/65/EU) and the AIFM Directive (2011/31/EU). LIAM is represented in the UK by Lyxor Asset Management UK LLP, which is authorized and regulated by the Financial Conduct Authority in the UK under Registration Number 435658. Société Générale is a French credit institution (bank) authorised by the Autorité de contrôle prudentiel et de résolution (the French Prudential Control Authority).

Research disclaimer

Lyxor International Asset Management (“LIAM”) or its employees may have or maintain business relationships with companies covered in its research reports. As a result, investors should be aware that LIAM and its employees may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision. Please see appendix at the end of this report for the analyst(s) certification(s), important disclosures and disclaimers. Alternatively, visit our global research disclosure website www.lyxoretf.com/compliance.

Conflicts of interest 

This research contains the views, opinions and recommendations of Lyxor International Asset Management (“LIAM”) Cross Asset and ETF research analysts and/or strategists. To the extent that this research contains trade ideas based on macro views of economic market conditions or relative value, it may differ from the fundamental Cross Asset and ETF Research opinions and recommendations contained in Cross Asset and ETF Research sector or company research reports and from the views and opinions of other departments of LIAM and its affiliates. Lyxor Cross Asset and ETF research analysts and/or strategists routinely consult with LIAM sales and portfolio management personnel regarding market information including, but not limited to, pricing, spread levels and trading activity of ETFs tracking equity, fixed income and commodity indices. Trading desks may trade, or have traded, as principal on the basis of the research analyst(s) views and reports. Lyxor has mandatory research policies and procedures that are reasonably designed to (i) ensure that purported facts in research reports are based on reliable information and (ii) to prevent improper selective or tiered dissemination of research reports. In addition, research analysts receive compensation based, in part, on the quality and accuracy of their analysis, client feedback, competitive factors and LIAM’s total revenues including revenues from management fees and investment advisory fees and distribution fees.

Connect with us on linkedin