BME to create a platform for mutual funds

BME to create a platform for mutual funds

04/03/10

Bolsas y Mercados Españoles (BME) will start a new subscription and redemption mutual fund platform after the summer with a view to offering greater transparency, flexibility and accessibility to this type of financial product.

The subscription and redemption mutual fund platform will be an additional access channel and will be open to all types of investors, market members and collective investment institutions. It will also be compatible with other fund distribution platforms.

This initiative is aimed at national and international mutual funds that are registered with the Spanish regulator, CNMV. The platform will allow them to rely on the wide distribution network, automated order handling and transparency offered by the Spanish stock exchange. Fund managers, investors and in general, all market participants, will benefit from the efficiency and speed of the platform.

The new project builds on BME’s previous and very positive, experience with collective investment institutions, specifically SICAVS (open-ended investment institutions) and ETFs. Practically all SICAVs are traded on the Spanish stock exchange’s electronic platform and trades are settled through the Spanish CSD and BME subsidiary Iberclear. As for ETFs, the system for channeling the trading is the stock exchange and their settlement is through Iberclear as well.

The system will allow the communication of orders through the Spanish stock exchange and the sending of positions to fund managers in real time. The market members will be the current ones and fund managers will also participate. Details about the funds, their net asset value and transactions will be disseminated through the usual information channels. The system will support fund subscriptions, redemptions and transfers. Later on it will offer the possibility of carrying out trades at their net asset value and of settling and registering them.

In developing the project the coincidences between Fund Managers and SICAVs were taken into consideration as well as the fact that the net asset values from both types of institutions are being received and disseminated via the Stock Exchange.