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Deutsche Bank Halts Share Issuance for DAG
February 16, 2011
SAN DIEGO (ETFguide.com) – Deutsche Bank announced it has halted the creation of new shares for the PowerShares DB Agriculture Double Long ETN (NYSEArca: DAG). The note attempts to double the daily performance of futures contracts linked to the performance of corn, wheat and soybeans.
In a concise statement with little details, Deutsche Bank said, “It will suspend, with immediate effect, any further issuance of the PowerShares DB Agriculture Double Long Exchange Traded Notes. Daily repurchases at the option of holders of the notes will not be affected by this suspension, but the product will not be offered to new investors. This suspension may cause fluctuations in the trading value of the notes.”
Interruptions of this nature have impacted other commodity linked products like the iShares S&P GSCI Commodity Index Trust (NYSEArca: GSG) and the PowerShares DB Commodity Index Tracking Fund (NYSEArca: DBC).
Over the past year or so, the Commodity Futures Trading Commission (CFTC) has imposed investment restrictions on various commodities futures contracts and in January proposed further limits. If approved, the rules would further restrict the amount of investments by a single entity or individual in commodity futures, options and swaps.
Commodity linked products like DBC have been forced to change their underlying strategies to avoid owning futures contracts that exceed the CFTC’s limits. |
