26 ETNs May See Premiums and Discounts After Issuance Halted

ETF Trends

Deutsche Bank says it will temporarily suspend further issuance of 26 exchange traded notes, which creates the potential for the ETNs to trade at premiums or discounts to net asset value like closed-end funds.

The 26 ETNs issued by the bank will halt the creation of new shares after the close of trading on March 29, according to a press release.

ETNs are debt instruments issued by financial institutions that promise to pay the return of an index, minus fees and taxes. Shareholders are exposed to the credit risk that the issuer goes bankrupt.

“Deutsche Bank expects to resume issuances of these ETNs following the publication of its 2012 Annual Report and Form 20-F in mid-April 2013,” according to the press release.

“It is possible that the temporary suspension … may materially influence the market value and the liquidity of the ETNs,” Deutsche Bank added. “The limitations on issuance and sale implemented may cause an imbalance of supply and demand in the secondary market for the ETNs, which may cause the ETNs to trade at a premium or discount in relation to their intraday indicative value.” [ETN Trading at Premium After Creation Halt]

These 26 ETNs are halting the creation of new shares:

  • PowerShares DB Base Metals Double Short ETN (NYSE Arca: BOM)
  • PowerShares DB Base Metals Double Long ETN (NYSE Arca: BDD)
  • PowerShares DB Base Metals Short ETN (NYSE Arca: BOS)
  • PowerShares DB Base Metals Long ETN (NYSE Arca: BDG)
  • PowerShares DB Crude Oil Double Short ETN (NYSE Arca: DTO)
  • PowerShares DB Crude Oil Short ETN (NYSE Arca: SZO)
  • PowerShares DB Crude Oil Long ETN (NYSE Arca: OLO)
  • PowerShares DB Gold Double Short ETN (NYSE Arca: DZZ, TSX: DGJ)
  • PowerShares DB Gold Double Long ETN (NYSE Arca: DGP,TSX: DGU)
  • PowerShares DB Gold Short ETN (NYSE Arca: DGZ)
  • PowerShares DB US Inflation ETN (NYSE Arca: INFL)
  • PowerShares DB US Deflation ETN (NYSE Arca: DEFL)
  • PowerShares DB 3x Short 25+ Year Treasury Bond ETN (NYSE Arca: SBND)
  • PowerShares DB 3x Long 25+ Year Treasury Bond ETN (NYSE Arca: LBND)
  • PowerShares DB 3x Short US Dollar Index Futures ETN (NYSE Arca: UDNT)
  • PowerShares DB 3x Long US Dollar Index Futures ETN (NYSE Arca: UUPT)
  • PowerShares DB 3x Italian Treasury Bond Futures ETN (NYSE Arca: ITLT)
  • PowerShares DB Italian Treasury Bond Futures ETN (NYSE Arca: ITLY)
  • PowerShares DB 3x German Bund Futures ETN (NYSE Arca: BUNT)
  • PowerShares DB German Bund Futures ETN (NYSE Arca: BUNL)
  • PowerShares DB 3x Japanese Govt Bond Futures ETN (NYSE Arca: JGBT)
  • PowerShares DB Japanese Govt Bond Futures ETN (NYSE Arca: JGBL)
  • PowerShares DB 3x Inverse Japanese Govt Bond Futures ETN (NYSE Arca: JGBD)
  • PowerShares DB Inverse Japanese Govt Bond Futures ETN (NYSE Arca: JGBS)
  • ELEMENTS — “Dogs of the Dow” Linked to the Dow Jones High Yield Select 10 Total Return Index (NYSE Arca: DOD)
  • ELEMENTS Linked to the Morningstar Wide Moat Focus Total Return Index (NYSE Arca: WMW)

The opinions and forecasts expressed herein are solely those of John Spence, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.

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