An oil-focused exchange traded note (ETN) has decided to temporarily stop issuing new shares, possibly in anticipation of new regulations from the Commodity Futures Trading Commission (CFTC).
Deutsche Bank has announced a temporary suspension of PowerShares DB Crude Oil Double Long ETN (DXO). According to the press release issued, this suspension may cause fluctuations in the trading value of the notes.
DXO is designed to provide investors with two times the monthly performance of an oil-based commodity index.
No explanation was given as to the reason behind the decision, but Joshua Schneyer for Reuters reports, “…it could be tied to recent moves by the U.S. Commodities Futures Trading Commission (CFTC) to clamp down on leveraged or speculative trading in some commodities, including energy contracts.”