The issuance is intended to allow SSGA’s end investors to buy and sell ETFs in the same way as they would mutual funds, using an end-of-day net asset value. In this way it should offer an additional way to access new products, through a scalable platform.
European mutual-fund investors will also gain access to the SPDR ETFs, 29 of which are sector ETFs.
FundSettle was launched by Euroclear in 2000 and automates and standardises the straight through processing (STP) of offshore and domestic fund transactions. It is intended to provide one single access point for fund buyers to process subscriptions, redemptions, transfers and switches.
The platform now has links to about 900 fund administrators in 27 domiciles, working through STP with third-party distributors such as private banks and wealth managers.
Philippe Roset, head of SPDR in the Netherlands, commented: “The issuance of our SPDR ETFs on FundSettle is in response to client requests, who wanted to be able to align their ETF order execution with transactions in mutual funds. Clients can now do so on an intra-day basis on an exchange, or in the same way as mutual funds on the FundSettle platform.”
“We have chosen to include our full range of 29 world, US, and European sector ETFs because we believe that sector investing is a valuable alternative to traditional investment approaches, such as growth or value investing.”
Mohamed M'Rabti, head of ETFs and FundSettle at Euroclear, added: "We are very proud to have been part of this collaboration with SPDR, which included consolidating their 60 share classes of French mutual funds into 11 Irish ETFs, a market first in Europe.”
“This consolidation completed the range of 29 Sector ETFs. These sector ETFs have been issued within our core platform using the international issuance model. Settlement will be centralised in Euroclear’s international central securities depository model, which makes the post-trade process of exchange trades easier and allows for better spreads and liquidity for investors.”
“Furthermore, a selection of SPDR ETFs will be available on our FundSettle platform to support the distribution effort of SPDR ETFs in reaching our mutual fund clients across Europe.”