OREANDA-NEWS. May 10, 2011. BM&FBOVESPA Exchange Traded Funds (ETFs) reached a record BRL 942.43 billion financial volume in April, in 28,969 trades and 14,734,230 units. The financial volume figure surpassed by 7.5% the previous record of BRL 876.25 million, of February 2011.

Average daily financial volume in the BRAX11, CSMO11, MOBI11, BOVA11, SMAL11, MILA11, PIBB11 and FIND11 ETFs was also a record in April at BRL 49.65 million, up 13% on the previous record of BRL 43.81 million, in February.

The most-traded ETF in April was BOVA11, which tracks the Ibovespa index. There were 25,650 transactions, with 12,235,830 units and a record financial volume of BRL 814.49 million, surpassing the previous record of BRL 779.92 million in February 2011. The PIBB11 fund which tracks the IBrX-50 index was the second-most traded in April, at 1,401 trades and a financial volume of BRL 80.66 million.

There was a 7.7% participation of individual investors in the total volume of ETFs in April. Institutional investors continued to lead, at 46.3%, followed by financial institutions (23.1%), foreign investors (21.8%) and public and private-sector companies (1.1%).

Exchange Traded Funds (ETFs) reflect market indices and can be traded on the Stock Exchange like shares. They allow investors to own the stocks that make up the fund’s portfolio without the need to buy the securities of each company directly. ETFs grant greater practicality, speed and efficiency upon investment and it is easy to track their performance, which is linked to the respective indices. Furthermore, ETFs can be lent in market transactions, in accordance with CVM and BM&FBOVESPA rules.

With the reduction of the round lot for ETFs to 10 from 100 units, in August 2010, an investor who previously required around BRL 6,350 to trade the BOVA11 ETF, which tracks Ibovespa, can now go onto this market with an investment around ten times smaller, at around BRL 635 (based on the May 3, 2011 quotation). As with stock investments, in order to invest in an ETF the investor must go through a brokerage house that is authorized by BM&FBOVESPA.