If you can’t find the product you want, why not build your own?
Around the world, exchange-traded funds (ETFs) continue to grow in assets and importance, breaking records along the way.
This time last year, we were looking at how trade relations between the US and China might play out and the best way to position a portfolio – especially in terms of sectors – according to which scenario an investor thought was most likely.
Earlier this year, ETFs and ETPs listed in Europe celebrated a record 55 consecutive months of net inflows, only 19 years after the first ETFs in Europe were launched.
The recent suspension of redemptions from Neil Woodford’s Equity Income fund is a cautionary tale and one that has further sharpened the spotlight on the liquidity of mutual funds, a category that includes exchange-traded funds (ETFs).
Liquidity in a pension fund context can mean a number of things. As long-term investors, pension funds can harvest the illiquidity premia by investing in private markets, which they have been doing increasingly over the past 10 years.1 On the other hand, pension funds are required to meet their liabilities and so need enough liquidity to ensure the payment of benefits to members.
It took almost five years, but the US regulator still surprised many in the exchange-traded fund (ETF) industry when it gave preliminary approval to Precidian Investments’ ActiveShares in May.
In this article, we use a cost comparison framework to contrast index futures (CME Group’s E-mini S&P 500 index futures) and three popular US-listed exchange-traded funds (ETFs) tracking the same index – SPY, VOO and IVV.
As ETFs are created to track ever more specialised market exposures, competitive pressures and new regulations are impacting the complex relationships between asset managers and index providers.
ESG investing – the incorporation of environmental, social and governance (ESG) factors into investment criteria – has grown rapidly in recent years.
An increasing number of institutional investors are interested in investments with an environmental, social and/or governance (ESG) focus.
Sustainable investing was once viewed as a trade-off between value and ‘values’. Yet today, it’s something investors can no longer afford to ignore.
Sustainable market indices are nothing new. The Dow Jones Sustainability index was launched in 1999 and the FTSE4Good index in 2001.
The Japanese economy has been experiencing significant and positive change since the election of Prime Minister Shinzo Abe in 2012. After a sustained period of economic stagnation, Japan’s return to growth is being fuelled by Abe’s transformative economic policies.
Can a new category of ETFs help address one of the oldest economic imbalances of all?
When ETFs first broke up the active management party in the fallout of the financial crisis, it was equity funds that bore the brunt of the impact.
In recent years, fixed income ETFs have been grabbing a larger slice of the ETF market as investors look to capitalise on the enhanced diversification, tradeability, price transparency and liquidity they can provide to bond portfolios. According to the latest research by Citi Business Advisory Services, fixed income ETF assets have increased at a robust 25% annual compound growth rate over the last decade, hitting more than $870bn by the end of 2018.
In this article, which is an excerpt from a recent State Street Global Advisors publication, we address one of the key misconceptions about fixed income (bond) ETFs – namely, that they have become so large that they are distorting the underlying bond market. Instead, we argue, despite their recent growth, fixed income ETFs represent a relatively small proportion of the world’s debt markets.
Fixed income will play both a pivotal and multi-faceted role in European pensions scheme portfolios. Whether it be for growth, income or liability and cash flow matching, many schemes in the region will need to hold bonds as they de-risk in a low yield environment.
In this article we examine the process for green bond labelling and certification and its implication for index investors. Passive (index-tracking) green bond funds are bound by eligibility rules and each index has its own labelling requirements.
Commodities have long been a staple of multi-asset investors. Traditionally used to diversify exposure to fixed income and equity holdings, they are more recently also a source of alternative risk premia. Whatever the use case, the desired feature of any commodities allocation is some combination of attractive performance, sufficient liquidity, and a transparent methodology.
Despite its favourable fundamentals and widely acknowledged growth potential, China continues to be under-owned by most global investors.
Over the last two decades, exchange-traded funds (ETFs) have been one of the most disruptive forces in the asset management industry. But could the tables be turned? In an era of excitement over the possibilities of financial technology (fintech), are ETFs vulnerable to being displaced themselves?
Over the past 18 months there has been an explosion in the number of ETFs focusing on new technology. From iShares to Ossiam, DWS to veteran investor Jim Rogers, it seems everyone has launched a fund based on how digitisation will revolutionise our lives.
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