First Investment Trust Investing in Japan's Commodity Market to be Launched in February



Tokyo Commodity Exchange, Inc. announced today that an investment trust, which invests directly in its gold futures contract, is to be launched on February 17, 2010. This Japanese investment trust, the first one to invest directly in the Japanese commodity futures market, will be set up and managed by ITC Investment Partners Corporation, an asset management subsidiary of Itochu Corporation. Astomax Co. Ltd., an independent commodity trading advisor, will be entrusted to perform part of its fund management. Daiwa Securities Co. Ltd. and Daiwa Securities Capital Markets will distribute the product.

The December 2008 amendment of the Ordinance for Enforcement of Act on Securities Investment Trust and Securities Investment Corporations of Japan enabled investment trusts to include commodity futures contracts in their portfolios. Thereafter, a number of investment products have been developed in response to the investors’ growing interest in the commodity markets to diversify their investment. Unlike the ones that were previously launched, this commodity investment trust is the first one to invest in a Japanese commodity futures market, and, therefore, the Exchange expects that this new product will contribute to the revitalization of the Japanese commodity market.    

Investment trusts investing in foreign markets are generally traded at a price calculated based on the settlement price of a European or American market. This settlement price is available after the close of the trading session, almost half a day after an investor applies for purchase during Tokyo business hours. On the other hand, this new investment trust, which invests only in the TOCOM market, can be traded at a price linked to the price movement of the Tokyo market on that same day, which the investor can follow right before he must place his order.   

Tadashi Ezaki, President & CEO of TOCOM commented, “We expect that the launch of this type of commodity investment trust would benefit TOCOM through an increase in trading activity, as well as it would enjoy wide public acceptance as a new way of investment in commodities. We also hope it would contribute to our goal of strengthening the linkage between the financial market and our market. We believe that this development will increase the competitiveness of the Japanese exchanges, and furthermore, enhance the competitive edge of the financial and capital markets of Japan.”