About a year ago, the Italian Stock Exchange, Borsa Italiana, launched a new segment of the ETFplus market (the open-ended collective investment undertaking (CIUs) segment) dedicated to the trading of open-ended UCITS funds.

Funds listing and market growth

After a slow start, mainly due to operational issues, the CIUs segment is now becoming increasingly attractive for both national and international players, with the benefits it offers in terms of access to an alternative and innovative marketing channel. 

The second half of 2015 has been particularly positive in terms of growth for this new market segment. So far, 100 funds have been listed by 16 asset managers.

The updated details of the list are available on the Borsa Italiana website.

The progressive increase in the number of listings and the growing interest of major players shows that the market has started moving. This will contribute to the creation of a distribution channel for UCITS funds additional to the traditional model in place in the Italian market, which is focused on marketing through authorised intermediaries.

Main features of the open-ended CIUs segment

The main features of the open-ended funds trading segment, which were released on 14 November 2014, are:

  • only UCITS funds (other than ETFs), either Italian or EU funds, may be admitted to trading
  • listing application shall be submitted by the fund’s issuer
  • there is no central counterparty
  • orders do not display prices (only quantity)
  • the trading price is the NAV of the fund on the relevant trading day as notified by the fund issuer on T+1 
  • trading model: auction call from 8:00 a.m. to 11:00 a.m.
  • any difference between buy and sell orders will be covered by an intermediary appointed by the fund issuer (the so-called 'operatore incaricato')
  • trading will take place through the entry on the book of market orders
  • buy and sell orders will be matched taking account of the time priorities of the individual orders until the quantities available are filled
  • contracts will be sent for settlement (via X-TRM) on the day following their conclusion and in any case in time for settlement on the third day following their conclusion

Listing of AIFs

Borsa Italiana has also looked after alternative investment funds by launching a new segment of the MIV (Market for Investment Vehicles) dedicated to AIFs. The listing of AIFs is of particular interest for those professional investors who may seek to overcome investment limits applying with respect to non-listed financial instruments.