Four Solactive Indices featured in top-ten US ETF launches in 2020
Among all passive ETFs launched on US stock exchanges year-to-date, four out of the 10 largest (measured by AuM inflows) are tracking Solactive indices, while two Solactive indices even range in the top-five.
Recently cracking the USD100 million mark in AuM, the first ETF on the list tracking a Solactive index is the Direxion Work From Home ETF (WFH). The Covid-19 crisis is still forcing millions of employees to work from home, corroborating an already enduring trend of remote working. While this unique situation creates new challenges for employers and employees alike, it also brings new opportunities for employees’ work-life balance and new business for companies offering key technological infrastructure and services that help enable working remotely. To allow investors to benefit from this major shift in society, Solactive developed its Solactive Remote Work Index, utilised by Direxion for WFH.
The next ETF gathered more than USD326 million in merely five weeks: The Global X Telemedicine & Digital Health ETF. Some economic sectors initially considered to be solely ‘offline’ are increasingly embracing the interweaving of digital infrastructure with society’s everyday life. The healthcare sector is a prime example of this trend, as a historically localised and analogue industry, which progressively adopts digital solutions to improve health outcomes and reduce costs. Solactive’s Telemedicine & Digital Health Index, which is underlying the Global X Telemedicine & Digital Health ETF (EDOC), includes companies both providing or affiliated with digital medical services and digital healthcare.
To select EDOC’s index components, Solactive utilised its proprietary Natural Language Processing algorithm, ARTIS, which parses large volumes of public documents, evaluating companies’ relevancy, exposure, and importance to the underlying theme.
The two final ETFs found among the ten largest newly incepted US-based ETFs year to date are the Goldman Sachs MarketBeta US Equity ETF and the Goldman Sachs MarketBeta International Equity ETF. The two ETFs offer investors exposure to the Large & Mid Cap segment of the United States and Developed Markets (excluding North American securities), respectively. Both ETFs track indices from Solactive’s Global Benchmark Series and collected more than USD500 million in assets in less than four months.
“As the popularity of ETFs increases around the globe, the epicentre of all ETF inceptions is still the US,” says Timo Pfeiffer, Chief Markets Officer at Solactive. “Besides a substantial number of newly launched products, notably in the thematic, access, and core ETF space, the world’s largest market saw a massive surge in assets since the drops seen in March. We are very pleased to be part of this expanding ETF ecosystem, helping to push innovation, particularly in the thematic space.”