Etikett: Swiss Franc

Investors rotate to cyclical assets as confidence is slowly restored

ETF Securities Investors rotate to cyclical assets as confidence is slowly restoredInvestors rotate to cyclical assets as confidence is slowly restored

Investors rotate to cyclical assets as confidence is slowly restored – Weekly Flows Analysis

Highlights

•    Investors have begun to rotate away from defensive assets such as gold and the Swiss Franc into cyclical assets such as industrial metals and oil

•    More clarity about the form of UK leadership and a delay in cutting interest rates in the UK has seen Sterling shorts unwinding, but that vote of confidence was not shared by equity investors

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The surprisingly quick appointment of a new Prime Minister and the formation of a new Cabinet in the UK provided investors some relief in a month of heightened uncertainty. Investors sold out of defensive assets like gold and the Swiss Franc and bought cyclical assets like copper and oil. Short positions in GBP were reduced as the Bank of England held off from cutting rates, taking the market by surprise. Investors continued to build shorts in UK equities and sold long positions.

Gold and CHF ETPs see first weekly outflows since Brexit, while goldminers see inflows. Gold prices declined 1.8% last week as some of the uncertainty around UK politics was assuaged with the appointment of a Prime Minister and the formation of a new Cabinet. Also the strong US payrolls data for the month of June proved to be gold-price negative. US$41.4mn flowed out of long gold ETPs. Long CHF ETPs, another defensive asset, saw outflows in order of US$21.8mn. The outflows from long gold ETPs were relatively small compared to the inflows of over US$1bn in the prior five weeks. While investors sold gold ETPs, they bought gold miner equity ETFs, possibly to capture equity market beta. Inflows of US$9.9mn into gold miner ETFs marked a 10 week high.

Investors rotate into industrial metals. Investors bought close to US$40.8mn of long broad industrial metal ETPs and a further US$27.4mn of long copper ETPs in a clear indication that the ‘risk-off’ mode expressed by markets earlier this month is fading. With Chinese industrial production, money supply, retail sales and GDP figures all beating expectations last week, we believe that sentiment toward industrial metals will continue to improve. Indeed with copper, zinc and nickel expected to remain in a production deficit this year, prospects for these metals look positive.

Crude oil ETPs see the largest inflows since April. Bargain hunting is back after oil prices fell to US$45/bbl from over US$51/bbl at the end of June. Last week we saw inflows of US$21.8mn into long crude oil products (the third consecutive week of inflows) and US$7.2mn of outflows from short crude oil products.

Investors reduce short GBP exposure but continue to short UK equities. We saw US$23.2mn of outflows from short GBP ETPs as confidence in the UK was partially restored and the Bank of England held off from delivering a widely expected rate cut. However, that vote of confidence was not shared by equity investors, who added US$9.2mn to short UK ETFs, marking the third consecutive week of inflows since Brexit and withdrew US$9.5mn from long UK equities.

Key events to watch this week. Markets will remain focused on the ECB press conference following the policy decision on Thursday. They will be poised for clues on whether the quantitative easing programme will be extended beyond March 2017. The Q2 Euro area bank lending survey, which will be released this week, may offer insights on the efficacy of programme.

Video Presentation

Nitesh Shah, Research Analyst at ETF Securities provides an analysis of last week’s performance, flow and trading activity in commodity exchange traded products and a look at the week ahead.

For more information contact

ETF Securities Research team
ETF Securities (UK) Limited
T +44 (0) 207 448 4336
E info@etfsecurities.com

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Market Madness Abates

Market Madness Abates

ETFS Multi-Asset Weekly – Market Madness Abates

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Highlights

Commodities: China concerns overdone. The market clearly over-extrapolated the consequences of the Chinese equity market rout.

When China catches a cold…. Global markets initially reeled as Chinese equities plunged again.

Currencies: Volatile asset performance pushes rate expectations out further.

A volatile week saw the VIX rise over 40, an occasion last seen during the US federal debt ceiling impasse and European financial woes of 2011. The price of many cyclical assets fell sharply before rising once again. Unusual for the summer, the sharp declines in price were accompanied by high trading volumes, indicating that algorithmic trades were driving much of the action. Void of any fundamentals driving the decline, most assets recovered a significant portion of their losses, with some cyclical assets like oil, copper and US equities (S&P 500) ending the week higher.

Commodities

China concerns overdone. The market clearly over-extrapolated the consequences of the Chinese equity market rout. Falling Chinese equity prices themselves are unlikely to impact the real economy in any significant way and therefore will have minimal impact on the country’s demand for raw materials. However, the spill-over effects of lower interest rates and liquidity injections could help commodity demand. After sharp declines in the first half of the week, industrial metal prices started to recover. Copper ended the week higher. Over the past three sessions, oil has rebounded 27%, driven by indications that OPEC may cut production, below-expectations US oil inventories and a downward revision in US oil production. Sugar gained 4.1% last week with a strengthening El Niño driving a poor monsoon in India. In the week to 26th August rainfall was 37% below normal, 12% below normal for the season as a whole.

Equities

When China catches a cold…. Global markets initially reeled as Chinese equities plunged again. Historically, Chinese and developed market equities have had a very low correlation and so last week’s moves were curious. By the end of the week, most developed markets recovered their losses. Last week’s rise in US equity market volatility was unmatched since 2011 when talk of a sovereign default was the only motivator to get the country’s debt ceiling extended. Chinese equities, the epicentre of last week’s saga, failed to recover. The MSCI China A-Share index fell 8.5% despite a cut in interest rates, a reduction in the reserve requirement ratio and further liquidity injections by the authorities. Excessive support for the equity market is distortionary and could hurt long-term performance. It would be better for the authorities to endure short-term volatility to pave the way for a more robust growth path.

Currencies

Volatile asset performance pushes rate expectations out further. The probability of a rate hike in September fell further according to Fed Fund futures rates. While St. Louis Fed President James Bullard tried to distance the volatile asset markets from strong US fundamentals, William Dudley, New York Fed President conceded that the case to raise rates in September was less compelling. The US dollar has depreciated as the rate differentials narrowed. The Australian dollar and New Zealand dollar took the brunt of the pain from volatile commodity markets. Barring a rate cut by the Reserve Bank of Australia this week, the AUD should recover alongside underlying commodities. Haven currencies such as the Japanese Yen and Swiss Franc appreciated amidst the market chaos, although gold failed to hold up gains seen in previous weeks. The ECB policy meeting and US payrolls data will remain the focus of the FX markets this week.

For more information contact:

ETF Securities Research team
ETF Securities (UK) Limited
T +44 (0) 207 448 4336
E  info@etfsecurities.com

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This communication has been issued and approved for the purpose of section 21 of the Financial Services and Markets Act 2000 by ETF Securities (UK) Limited (”ETFS UK”) which is authorised and regulated by the United Kingdom Financial Conduct Authority (”FCA”).

Investments may go up or down in value and you may lose some or all of the amount invested.  Past performance is not necessarily a guide to future performance. You should consult an independent investment adviser prior to making any investment in order to determine its suitability to your circumstances.

The information contained in this communication is for your general information only and is neither an offer for sale nor a solicitation of an offer to buy securities. This communication should not be used as the basis for any investment decision. Historical performance is not an indication of future performance and any investments may go down in value.

This communication may contain independent market commentary prepared by ETFS UK based on publicly available information. Although ETFS UK endeavours to ensure the accuracy of the content in this communication, ETFS UK does not warrant or guarantee its accuracy or correctness. Any third party data providers used to source the information in this communication make no warranties or representation of any kind relating to such data. Where ETFS UK has expressed its own opinions related to product or market activity, these views may change. Neither ETFS UK, nor any affiliate, nor any of their respective, officers, directors, partners, or employees accepts any liability whatsoever for any direct or consequential loss arising from any use of this publication or its contents.

ETFS UK is required by the FSA to clarify that it is not acting for you in any way in relation to the investment or investment activity to which this communication relates. In particular, ETFS UK will not provide any investment services to you and or advise you on the merits of, or make any recommendation to you in relation to, the terms of any transaction.  No representative of ETFS UK is authorised to behave in any way which would lead you to believe otherwise. ETFS UK is not, therefore, responsible for providing you with the protections afforded to its clients and you should seek your own independent legal, investment and tax or other advice as you see fit.

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Securities issued by each of the Issuers are direct, limited recourse obligations of the relevant Issuer alone and are not obligations of or guaranteed by any of UBS AG, Merrill Lynch Commodities Inc. (”MLCI”), Bank of America Corporation (”BAC) or any of their affiliates. UBS AG, MLCI and BAC, Shell Trading Switzerland, Shell Treasury, HSBC Bank USA N.A., JP Morgan Chase Bank, N.A., Deutsche Bank AG any of their affiliates or anyone else or any of their affiliates. Each of UBS AG, Merrill Lynch Commodities Inc. (”MLCI”), Bank of America Corporation (”BAC) or any of their affiliates. UBS AG, MLCI and BAC, Shell Trading Switzerland, Shell Treasury, HSBC Bank USA N.A., JP Morgan Chase Bank, N.A. and Deutsche Bank AG disclaims all and any liability whether arising in tort, contract or otherwise (save as referred to above) which it might have in respect of this document or its contents otherwise arising in connection herewith.

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Gold Shines as China’s Economy Fuels Growth Concerns

Gold Shines as China’s Economy Fuels Growth Concerns

ETFS Multi-Asset Weekly – Gold Shines as China’s Economy Fuels Growth Concerns

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Highlights


•    Precious metals extend rally while energy continues to slide.
•    Equity market volatility spikes as more than 5 trillion is wiped out from global equity markets since China devalued its Yuan.
•    Euro, Yen and Swiss Franc remain strongest amidst risk averse backdrop.

Asian markets have opened the week sharply lower, exacerbating the global selloff in the aftermath of China’s currency reform. Despite attempts made by the Chinese government from lowering interest rates to the reserve requirement, suspending stock trading and finally devaluing its currency, sentiment is decisively negative. Equity market volatility along with Fed dovish Federal Reserve minutes has helped gold prices rally and any dovishness from this week’s meeting of central bankers at Jackson Hole could add to that momentum.

Commodities

Precious metals extend rally while energy continues to slide. Gold at US$ 1154/oz has staged a comeback attaining its highest level in 5 weeks. Concerns over China’s growth path and slightly more dovish set of Federal Reserve Policy minutes drove gold higher in US dollar terms. The 38% y-o-y increase in platinum imports by China in July has helped support this week’s advance of 5.4%. WTI and Brent crude oil fell to US$39 and US$45 per barrel respectively continuing their 8th week of declines, the longest losing streak since 1986. The lowest reading in 9 years 47.1 in Caixin’s China purchasing manager’s index (PMI) for August coupled with the surprise increase of 2.5mn barrels in crude oil stocks by the US Department of Energy raised fears of waning demand in an oversupplied market.

Equities

Equity market volatility spikes as more than 5 trillion is wiped out from global equity markets since China devalued its Yuan. Weaker Chinese PMI data outweighed the strengthening European PMI data, accelerating a selloff in global equity markets. France’s economy stagnated in the second quarter and despite factory data in Germany rising to a 4-year high, the DAX fell 7.8%. Commodity stocks that make up about fifth of the FTSE 100 Index weighting caused the Index’s biggest weekly decline since December. In particular, mining giant Glencore PLC was the latest to fall prey to the commodity rout as profits declined 56% in H1. Its plans to close Eland platinum mine in South Africa and divest its 23.9% holding in Lonmin Plc (the world’s third largest platinum producer) extended further pressure on platinum supply.

Currencies

Euro, Yen and Swiss Franc remain strongest amidst risk averse backdrop. With risk off the table, the unwinding of carry trades lent support to low yielding currencies namely Euro and Yen. Although the impending Greek elections following Syriza party’s split could pose a risk to the Euro. The lack of a clear signal from the Fed minutes and miss on the manufacturing PMI pushed the probability of a Fed rate hike in September from 50 to 28 percent, reversing the strengthening dollar. The continued weakness in oil prices weighed heavily on the Canadian currency. The positive CPI print early in the week lent support to Sterling as investors see encouraging signs of the UK moving nearer to a rate increase.

For more information contact:

ETF Securities Research team
ETF Securities (UK) Limited
T +44 (0) 207 448 4336
E  info@etfsecurities.com

Important Information

General

This communication has been issued and approved for the purpose of section 21 of the Financial Services and Markets Act 2000 by ETF Securities (UK) Limited (”ETFS UK”) which is authorised and regulated by the United Kingdom Financial Conduct Authority (”FCA”).

Investments may go up or down in value and you may lose some or all of the amount invested.  Past performance is not necessarily a guide to future performance. You should consult an independent investment adviser prior to making any investment in order to determine its suitability to your circumstances.

The information contained in this communication is for your general information only and is neither an offer for sale nor a solicitation of an offer to buy securities. This communication should not be used as the basis for any investment decision. Historical performance is not an indication of future performance and any investments may go down in value.

This communication may contain independent market commentary prepared by ETFS UK based on publicly available information. Although ETFS UK endeavours to ensure the accuracy of the content in this communication, ETFS UK does not warrant or guarantee its accuracy or correctness. Any third party data providers used to source the information in this communication make no warranties or representation of any kind relating to such data. Where ETFS UK has expressed its own opinions related to product or market activity, these views may change. Neither ETFS UK, nor any affiliate, nor any of their respective, officers, directors, partners, or employees accepts any liability whatsoever for any direct or consequential loss arising from any use of this publication or its contents.

ETFS UK is required by the FSA to clarify that it is not acting for you in any way in relation to the investment or investment activity to which this communication relates. In particular, ETFS UK will not provide any investment services to you and or advise you on the merits of, or make any recommendation to you in relation to, the terms of any transaction.  No representative of ETFS UK is authorised to behave in any way which would lead you to believe otherwise. ETFS UK is not, therefore, responsible for providing you with the protections afforded to its clients and you should seek your own independent legal, investment and tax or other advice as you see fit.

This document is not, and under no circumstances is to be construed as, an advertisement or any other step in furtherance of a public offering of shares or securities in the United States or any province or territory thereof. Neither this document nor any copy hereof should be taken, transmitted or distributed (directly or indirectly) into the United States.

Other than as set out above, investors may contact ETFS UK at +44 (0)20 7448 4330 or at retail@etfsecurities.com to obtain copies of prospectuses and related regulatory documentation, including annual reports. Other than as separately indicated, this communication is being made on a ”private placement” basis and is intended solely for the professional / institutional recipient to which it is delivered.

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Securities issued by each of the Issuers are direct, limited recourse obligations of the relevant Issuer alone and are not obligations of or guaranteed by any of UBS AG, Merrill Lynch Commodities Inc. (”MLCI”), Bank of America Corporation (”BAC) or any of their affiliates. UBS AG, MLCI and BAC, Shell Trading Switzerland, Shell Treasury, HSBC Bank USA N.A., JP Morgan Chase Bank, N.A., Deutsche Bank AG any of their affiliates or anyone else or any of their affiliates. Each of UBS AG, Merrill Lynch Commodities Inc. (”MLCI”), Bank of America Corporation (”BAC) or any of their affiliates. UBS AG, MLCI and BAC, Shell Trading Switzerland, Shell Treasury, HSBC Bank USA N.A., JP Morgan Chase Bank, N.A. and Deutsche Bank AG disclaims all and any liability whether arising in tort, contract or otherwise (save as referred to above) which it might have in respect of this document or its contents otherwise arising in connection herewith.

”Dow Jones,” ”UBS”, DJ-UBS CISM,”, ”DJ-UBS CI-F3SM,” and any related indices or sub-indices are service marks of Dow Jones Trademark Holdings LLC (”Dow Jones”), CME Group Index Services LLC (”CME Indexes”), UBS AG (”UBS”) or UBS Securities LLC (”UBS Securities”), as the case may be, and have been licensed for use by the Issuer. The securities issued by CSL although based on components of the Dow Jones UBS Commodity Index 3 month ForwardSM are not sponsored, endorsed, sold or promoted by Dow Jones, CME Indexes, UBS, UBS Securities or any of their respective subsidiaries or affiliates, and none of Dow Jones, CME Indexes, UBS, UBS Securities, or any of their respective subsidiaries or affiliates, makes any representation regarding the advisability of investing in such product.

Research Update – Swiss Gold Referendum

Research Update – Swiss Gold Referendum

Background Research Update – Swiss Gold Referendum

The right-wing Swiss People’s Party introduced a referendum entitled ‘Save our Swiss Gold’. On 30 November Swiss voters will decide whether or not to force the Swiss National bank (SNB) to hold 20% of foreign reserves as gold, stop the SNB selling gold, and to repatriate all Swiss gold held in foreign central bank vaults.

In order to fight the threat of deflation and support the economy, the SNB’s key policy is capping the gains of the Swiss Franc against the Euro at 1.20. A strong Franc hurts the competitiveness of the Swiss economy, so the SNB is trying to limit the gains of the Franc against the Euro, as the Eurozone is its main trading partner. The SNB’s currency policy has seen the central bank amass sizeable foreign currency reserves as it buys Euros to defend the 1.20 cap, which forms part of the SNB’s asset base.

The SNB’s gold reserves currently total around US$43bn, less than 10% of the SNB’s total assets. If the referendum is successful, the SNB would need to buy at least another 1500-2000 tonnes, equivalent to around 40% of total annual global gold supply (or around 60% of global mine production). Such demand would likely spur a significant and sharp gold price rise.

Historically the Franc has been viewed as a safe haven currency because it had a strong gold backing. As the central bank acquires more and more gold, it is probable that currency market views this as a positive for the currency and makes it harder for the central bank to achieve its aim for the currency. The SNB would also not be able to sell any gold under the proposal, which could also lead to gold being the majority of its asset base. Even if the central bank’s balance sheet contracts in future, it would be unable to sell gold previously bought, thereby exacerbating the problem.

Both the government and the SNB are against the gold referendum, viewing it as limiting their ability manage the economy. The SNB has indicated that being mandated to have to buy gold could mean that the market doubts the SNB’s resolve to buy large sums of Euros and gold if the referendum is passed. Clearly, the SNB’s credibility is at risk because the central bank will find it difficult to keep the Franc’s gains capped if it has to buy gold as well as Euros to defend the cap.

Regardless of how far-fetched investors believe the chance of a successful outcome for the referendum, Swiss voters have already shown nationalistic tendencies this year. In February, voters in Switzerland approved (by a narrow 50.3%) curbing immigration, ending the freedom of movement accord that had existed with the EU since 2002. Notably, the immigration referendum was also brought about by the same right-wing party, the SVP.

Implications

We expect the Swiss Franc to rally and test the SNB commitment to keeping its currency policy floor against the Euro if the gold referendum is passed. A ‘yes’ vote would mean that the CHF would have a stronger gold backing, raising its appeal for investors looking for hard asset exposure in an uncertain European economic climate. The more the CHF rises and the more Euros the SNB buys, the more gold it will need to accumulate, thereby exacerbating the problem.

We expect an initial gold rally if the referendum is passed, but the longer-term effects depend on the timing and source of gold that the SNB purchases. If the SNB buys gold on the open market, the price impact on gold is likely to be sustained as it represents additional demand. However, if it purchases gold off-market (from other central banks for example) it would not represent additional demand and the price effect would likely be transitory. The SNB has five years to achieve the gold target level of 20% of assets, but if it is seen to act in a timely fashion to build gold holdings, the effect on gold is likely to be more pronounced.

While recent polls have shown it is less likely the referendum is passed, a large proportion undecided voters will be key for the result. Nevertheless, the market appears not to have priced in the chance of ‘yes’ vote and we expect the risks for the Swiss Franc (and gold) are skewed to the upside.

Important Information

General

This communication has been provided by ETF Securities (UK) Limited (“ETFS UK”) which is authorised and regulated by the United Kingdom Financial Conduct Authority (the “FCA”).

This communication is only targeted at qualified investors as such term is defined in Directive 2010/73/EU and professional investors as such term is defined in Directive 2004/39/EC.

The information contained in this communication is for your general information only and is neither an offer for sale nor a solicitation of an offer to buy securities. This communication should not be used as the basis for any investment decision. Historical performance is not an indication of future performance and any investments may go down in value.

This document is not, and under no circumstances is to be construed as, an advertisement or any other step in furtherance of a public offering of shares or securities in the United States or any province or territory thereof. Neither this document nor any copy hereof should be taken, transmitted or distributed (directly or indirectly) into the United States.

This communication may contain independent market commentary prepared by ETFS UK based on publicly available information. Although ETFS UK endeavours to ensure the accuracy of the content in this communication, ETFS UK does not warrant or guarantee its accuracy or correctness. Any third party data providers used to source the information in this communication make no warranties or representation of any kind relating to such data. Where ETFS UK has expressed its own opinions related to product or market activity, these views may change. Neither ETFS UK, nor any affiliate, nor any of their respective, officers, directors, partners, or employees accepts any liability whatsoever for any direct or consequential loss arising from any use of this publication or its contents.

ETFS UK is required by the FCA to clarify that it is not acting for you in any way in relation to the investment or investment activity to which this communication relates. In particular, ETFS UK will not provide any investment services to you and or advise you on the merits of, or make any recommendation to you in relation to, the terms of any transaction. No representative of ETFS UK is authorised to behave in any way which would lead you to believe otherwise. ETFS UK is not, therefore, responsible for providing you with the protections afforded to its clients and you should seek your own independent legal, investment and tax or other advice as you see fit.

 

US Dollar to Remain Strong on Dovish Central Bank Rhetoric

US Dollar to Remain Strong on Dovish Central Bank Rhetoric

US Dollar to Remain Strong on Dovish Central Bank Rhetoric. ETFS CURRENCY WEEKLY

A weekly overview of global currency market developments. The report details the past week’s performance of G10 currency pairs and currency baskets, directional model signals for the week ahead, longer-term consensus currency forecasts, futures market positioning data and a macroeconomic commentary on the FX market.

US Dollar to Remain Strong on Dovish Central Bank Rhetoric

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Summary

ECB in ’wait and see’ mode

JPY to continue lower as BOJ looks for wage growth

US jobs to boost USD

Regional reports

United Kingdom: Sterling (GBP)

Europe: Euro (EUR)
Switzerland: Swiss Franc (CHF)

For more information contact:

ETF Securities Research team
ETF Securities (UK) Limited
T +44 (0) 207 448 4336
E info@etfsecurities.com

Important Information

General

This communication has been issued and approved for the purpose of section 21 of the Financial Services and Markets Act 2000 by ETF Securities (UK) Limited (”ETFS UK”) which is authorised and regulated by the United Kingdom Financial Conduct Authority (”FCA”).

Investments may go up or down in value and you may lose some or all of the amount invested.  Past performance is not necessarily a guide to future performance. You should consult an independent investment adviser prior to making any investment in order to determine its suitability to your circumstances.

The information contained in this communication is for your general information only and is neither an offer for sale nor a solicitation of an offer to buy securities. This communication should not be used as the basis for any investment decision. Historical performance is not an indication of future performance and any investments may go down in value.

This communication may contain independent market commentary prepared by ETFS UK based on publicly available information. Although ETFS UK endeavours to ensure the accuracy of the content in this communication, ETFS UK does not warrant or guarantee its accuracy or correctness. Any third party data providers used to source the information in this communication make no warranties or representation of any kind relating to such data. Where ETFS UK has expressed its own opinions related to product or market activity, these views may change. Neither ETFS UK, nor any affiliate, nor any of their respective, officers, directors, partners, or employees accepts any liability whatsoever for any direct or consequential loss arising from any use of this publication or its contents.

ETFS UK is required by the FSA to clarify that it is not acting for you in any way in relation to the investment or investment activity to which this communication relates. In particular, ETFS UK will not provide any investment services to you and or advise you on the merits of, or make any recommendation to you in relation to, the terms of any transaction.  No representative of ETFS UK is authorised to behave in any way which would lead you to believe otherwise. ETFS UK is not, therefore, responsible for providing you with the protections afforded to its clients and you should seek your own independent legal, investment and tax or other advice as you see fit.

This document is not, and under no circumstances is to be construed as, an advertisement or any other step in furtherance of a public offering of shares or securities in the United States or any province or territory thereof. Neither this document nor any copy hereof should be taken, transmitted or distributed (directly or indirectly) into the United States.

Other than as set out above, investors may contact ETFS UK at +44 (0)20 7448 4330 or at retail@etfsecurities.com to obtain copies of prospectuses and related regulatory documentation, including annual reports. Other than as separately indicated, this communication is being made on a ”private placement” basis and is intended solely for the professional / institutional recipient to which it is delivered.

Third Parties

Securities issued by each of the Issuers are direct, limited recourse obligations of the relevant Issuer alone and are not obligations of or guaranteed by any of UBS AG, Merrill Lynch Commodities Inc. (”MLCI”), Bank of America Corporation (”BAC) or any of their affiliates. UBS AG, MLCI and BAC, Shell Trading Switzerland, Shell Treasury, HSBC Bank USA N.A., JP Morgan Chase Bank, N.A., Deutsche Bank AG any of their affiliates or anyone else or any of their affiliates. Each of UBS AG, Merrill Lynch Commodities Inc. (”MLCI”), Bank of America Corporation (”BAC) or any of their affiliates. UBS AG, MLCI and BAC, Shell Trading Switzerland, Shell Treasury, HSBC Bank USA N.A., JP Morgan Chase Bank, N.A. and Deutsche Bank AG disclaims all and any liability whether arising in tort, contract or otherwise (save as referred to above) which it might have in respect of this document or its contents otherwise arising in connection herewith.

”Dow Jones,” ”UBS”, DJ-UBS CISM,”, ”DJ-UBS CI-F3SM,” and any related indices or sub-indices are service marks of Dow Jones Trademark Holdings LLC (”Dow Jones”), CME Group Index Services LLC (”CME Indexes”), UBS AG (”UBS”) or UBS Securities LLC (”UBS Securities”), as the case may be, and have been licensed for use by the Issuer. The securities issued by CSL although based on components of the Dow Jones UBS Commodity Index 3 month ForwardSM are not sponsored, endorsed, sold or promoted by Dow Jones, CME Indexes, UBS, UBS Securities or any of their respective subsidiaries or affiliates, and none of Dow Jones, CME Indexes, UBS, UBS Securities, or any of their respective subsidiaries or affiliates, makes any representation regarding the advisability of investing in such product.