Danish funds association defends IFX exchange
The Danish Investment Fund Association – Investeringsfondsbranchen – has responded to queries raised in local newspaper Jyllands Posten about the market for Danish Investment Associations, or funds, that are listed on the Nasdaq OMX operated funds market InvesteringsForeningsBørsen (IFX), by noting that the exchange offers “clear advantages to investors”.
The robust response comes in the wake of an article in Jyllands Posten suggesting that users of IFX may find it difficult to trade their shares.
IFX was set up in 2007 by Nasdaq OMX, VP Securities, FundCollect and the Fund Association, in order to offer trading in fund shares in a regulated market.
Domestic open ended funds in Denmark are listed on the exchange, which means investors can buy and sell shares with each other, rather than relying on trade with the product provider, which is the more common model across Europe – as distinct from listed closed ended funds.
“Instead of buyers and sellers trading directly with the provider, as they do overseas, in Denmark they can meet on IFS, and have the opportunity to trade at better prices,” the Fund Association said.
“This means that buyers pay less for their shares than if they traded directly with the provider. And the sellers get more for their shares.”
Association CEO Jens Jørgen Holm Møller (pictured) added: “IFX quite clearly offers advantages to investors. But as in all other markets there needs to be both a buyer and a seller for a trade to go through IFX, and of course one cannot demand a price at which the counterparty will trade. Alternatively, there is always the option of buying or selling shares via the bank.”