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NEWSLETTER | 30 Apr 2021  

ETFs shoot for the moon



etf express beverly chandler captioned.jpgThis week’s newsletter brings you all the diversification, opening with the views of WallachBeth’s senior strategist, Ilya Feygin, who is well placed to see what institutional investors in the US want from ETFs.   

Part of what they want is access to disruptive innovation through the medium of the ETF, such as those offered by ARK or Direxion, he says. “There is a minimum of 10,000 variations of growth and value and these ETFs provide exposure to disruptive innovation which people like,” he says. “These are equities than can go to the moon and that’s want people want.” 

Other winning subjects for the diversified ETF industry are, those perennial favourites, ESG and crypto, and we have a little example of each in this week’s newsletter, with an interview with ETC Group’s Bradley Duke who details their impressive asset raise, from a standing start last June, to over USD1.5 billion, all in bitcoin and its crypto siblings. “We didn’t expect it to grow as quickly as it did,” he says, modestly. 

More diversification comes this week with our interview withDavid LaValle, CEO of index provider Alerian, which had its feet firmly in the Master Limited Partner (MLP) sector but after acquiring S-Network Global Indexes in 2020, and in terms of its own intellectual property, has expanded into offering indices based on everything from Space to (with extraordinary market timing) Black Swan events. 

HAN-GINS’ Anthony Ginsberg is so keen on diversification that he has overseen the introduction of new indices and names for his HAN-GINS Cloud Technology UCITS ETF (SKYY) and HAN-GINS Indxx Healthcare Innovation UCITS ETF (WELL). 

Turning to ESG, we have a round-up of ESG launches and reports on asset growth this week, with BlackRock’s iShares Sustainable UCITS EMEA ETF range crossing USD50 billion in assets, with Q1 2021 inflows of USD10 billion almost tripling the pace of asset gathering in the same quarter of 2020, and UBS Asset Management’s Sustainable Development Bank Bonds UCITS ETF reaching USD1 billion in assets. 

The UK’s first digital wealth manager, Nutmeg, which uses ETFs for its investment management, reported a record year this year, with assets reaching over GBP3 billion for 130,000 investors while Blackwater Search & Advisory published a report that found, oddly, that despite all the good news of assets flowing into the ETF industry, European mutual fund managers do not fear the rise of the new kids on the block, and do not see a business case for launching an ETF of their own.  

Blackwater’s O’Riordan says: “When one looks at the success of ETFs, the temptation is to get distracted by their prosperity in the US and simply assume that Europe will follow in the same direction – it might be just a matter of time, but not necessarily.” He names several tailwinds that the European ETF industry faces, including the lack of tax relief experienced in the US, fewer self-directed investors and different fee models.  

To receive this weekly newsletter, do register here.  

Beverly Chandler
Managing Editor, ETF Express

Companies in this issue 
21Shares
Alerian
Amundi
BlackRock
Blackwater Search & Advisory
CI Global Asset Management
ETC Group
FinEx
HAN-GINS
Invesco
Nutmeg  
UBS Asset Management
WallachBeth 



 



 
  LATEST NEWS
Korea Investment & Securities Asia Limited goes live with Horizon platform for ETF Market Making on SEHK
Wed | 28 Apr 2021, 09:18
Korea Investment & Securities Asia Limited (KISA), one of the leading Korean securities brokerage houses in Hong Kong, has deployed Horizon Software's Platform for ETF Market Making connecting to the Hong Kong Stock Exchange (SEHK).
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NTree hires China expert to support growth in the region
Tue | 27 Apr 2021, 13:56
NTree International Ltd, an expert in investor education and distribution of ETFs, has hired Brendan Mueller as Head of Greater China to help develop its business in the region.    
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New data reveals investor optimism as those going long outnumber those shorting stocks
Tue | 27 Apr 2021, 13:55
New data from ETP provider GraniteShares has revealed strong investor confidence as global economies recover and GDP growth forecasts increase. 
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ETC Group enjoys one of the most successful launches with its crypto products
Tue | 27 Apr 2021, 11:56
Last June saw the launch of a new bitcoin ETP from new issuers ETC Group, working through the HANetf white label platform. That ETP, the BTCetc Physical Bitcoin Exchange Traded Crypto, plus its two crypto siblings, one based on ether and the other on litecoin, have now raised USD1.5 billion in capital, making the arrival of this fledgling firm one of the most successful ever. 
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ESG ETFs continue to pull in the assets
Tue | 27 Apr 2021, 12:01
Sustainability continues to drive ETF assets, both in bonds and equities and two firms have reported their ESG assets reaching record levels this week, with BlackRock’s iShares Sustainable UCITS EMEA ETF range crossing USD50 billion in assets, with Q1 2021 inflows of USD10 billion almost tripling the pace of asset gathering in the same quarter of 2020, and UBS Asset Management’s Sustainable Development Bank Bonds UCITS ETF reaching USD1 billion in assets. 
  READ MORE  >
Nutmeg enjoys record year with assets reaching over GBP3 billion
Wed | 28 Apr 2021, 08:13
The UK’s first digital wealth manager, Nutmeg, closed the first quarter of 2021 with over GBP3 billion in assets and a client base of over 130,000 UK investors.
  READ MORE  >
WallachBeth’s Feygin comments on US institutional demand for ETFs and the joys of equities that can go to the moon
Mon | 26 Apr 2021, 13:22
A leading agency broker dealer and provider of institutional execution services in the US, WallachBeth, is well positioned to see what its institutional clients are buying in the ETF space. 
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Research from Blackwater finds European mutual funds surprisingly calm about rising ETF assets
Mon | 26 Apr 2021, 13:31
European mutual fund managers do not perceive the ETF vehicle as a threat to their businesses according to a survey from Blackwater Search & Advisory. 
  READ MORE  >
Alerian’s LaValle details the firm’s expansion from those MLP roots
Fri | 23 Apr 2021, 14:19
The rise of thematic ETF investing has given indexers fertile grounds in which to grow their products. Index provider Alerian had its feet firmly in the Master Limited Partner (MLP) sector but after acquiring S-Network Global Indexes in 2020, and in terms of its own intellectual property, the firm has expanded into offering indices based on everything from Space to (with extraordinary market timing) Black Swan events. 
  READ MORE  >
Ginsberg aims for diversification with the re-ordering of his HAN-GINS ETFs
Fri | 23 Apr 2021, 09:29
Anthony Ginsberg has overseen the introduction of new indices and names for his HAN-GINS Cloud Technology UCITS ETF (SKYY) and HAN-GINS Indxx Healthcare Innovation UCITS ETF (WELL). 
  READ MORE  >
Global ETF launches 22-29.04.21
Thu | 29 Apr 2021, 11:48
Sustainability and ESG investing dominated ETF launches this week. Invesco expanded its thematic environmental suite by listing the Invesco MSCI Green Building ETF focusing on the entire green building ecosystem, and BlackRock debuted two Paris Aligned iShares UCITS ETFS designed to capture opportunities arising from the transition to a lower carbon economy. Amundi also added fixed income exposure to its Climate Paris Aligned ETF range with the Amundi iCPR Euro Corp Climate Paris Aligned PAB – UCITS ETF DR. Digital assets also featured again this week with WisdomTree debuting the WisdomTree Ethereum ETP (ETHW) on Borse Xetra and Six, a low priced physically-backed ether ETP. Elsewhere investors turned their attention to Asia as Qontigo licensed the EURO STOXX 50 Index to KBSTAR ETF to serve as underlying for an ETF listed on the Korea exchange. Finally, FinEx launched the Fallen Angels ETF, allowing investors to capture risk premium in USD bonds that have recently been downgraded from investment grade to high yield while belonging to the relatively attractive BB+ to BB- rating segment.
  READ MORE  >
 
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  IN MY OPINION

ETF Trading: New trading tools have emerged, accelerating the growth of on-exchange execution

Ivan Gilmore (pictured), Head of Securities Trading, London Stock Exchange, London Stock Exchange Group (LSEG) writes that stock exchanges have shown resilience through mixed times and looks forward to a golden age of ETFs that lies ahead…

 
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