Latest news

Diversification and low cost driving ETF usage in Australia Diversification and low cost driving ETF usage in Australia

ETF use is on the rise in Australia, according to a survey carried out by BetaShares, a leading Australian ETF provider. The survey showed that diversification and low cost were the main reasons driving investment in ETFs, though liquidity and access also polled well. Drew Corbett, Head of Investment Strategy at BetaShares, said: “It’s not surprising investors are finding multiple reasons to use ETFs, ranging from accessing investments and liquidity as well as the core benefits of diversification and low cost.”

Institutional investors increasingly using ETFs strategically Institutional investors increasingly turning to ETFs, study shows

Institutional investors are increasingly turning to ETFs to facilitate a variety of essential operational, tactical and strategic portfolio management practices, a study released by Greenwich Associates shows. The results reveal that once institutions integrate ETFs into manager transitions or cash equitisation processes, they quickly use ETFs for additional purposes such as liquidity management or longer-term strategic exposures. The study also reveals that the average institutional holding period for ETF investments has expanded meaningfully over the past year.

Vanguard undercuts rivals with low-cost London-listed ETF range Vanguard undercuts rivals with low-cost London-listed ETF range

After much anticipation among followers of the European ETF industry, indexing giant Vanguard has formally announced that it has received regulatory authorisation for a suite of Irish-domiciled ETFs, and that an initial five will be listed on the London Stock Exchange shortly. The five ETFs, all of which are physically-backed and come with fees of between 0.09% and 0.45%, are the Vanguard FTSE 100 ETF, the Vanguard S&P 500 ETF, the Vanguard FTSE Emerging Markets ETF, the Vanguard FTSE All-World ETF and the Vanguard UK Government Bond ETF.

Equities

Amundi lists EUR daily hedged S&P 500 ETF on Deutsche Börse Amundi lists EUR daily hedged S&P 500 ETF on Deutsche Börse

France-based ETF provider Amundi has announced that the Amundi ETF S&P 500 EUR Hedged Daily (H1D5) has been cross-listed on the Deutsche Börse, supplementing the fund’s existing listing on NYSE Euronext Paris. The fund enables investors to participate in the performance of the S&P 500 Total Return Net Index, a widely-tracked index of ‘blue chip’ US stocks, with hedging against daily exchange rate fluctuations between the euro and the US dollar. The ETF provides a packaged solution for investors who do not have the capacity to manage currency risk themselves.

Commodities

Source launches enchanced 'roll-optimised' Brent Crude oil ETC Source launches enhanced roll-optimised Brent crude oil ETC (BOIL)

Source, a UK-based provider of exchange-traded products (ETPs), has announced the launch of the Source Brent Crude Enhanced T-ETC (BOIL). The Treasury-secured ETC offers optimised exposure to Brent crude oil via the S&P GSCI Brent Crude Enhanced Total Return Index. Brent crude is increasingly recognised as a distinct and important oil benchmark, and has recently consistently traded at a premium to WTI. The ETC adheres to a series of dynamic rolling rules which help mitigate the potential effects of contango (negative roll yield).

Fixed Income

High-yield bond ETFs backed by cash-rich corporates High-yield bond ETFs backed by cash-rich corporates

Recent gloomy economic data points to the prolonged need for accommodative monetary policy, and thus low interest rates, which should bode well for high-yield bonds backed by cash-rich corporates. At least, that’s the view of Tim Gardner, Co-Manager of Legal & General’s Multi-Manager fund range, who last week increased allocation to high-yield bonds. For investors looking to access high-yield bonds, there’s a plethora of ETFs to consider.

Alternatives / Multi-Asset

Lyxor merges ETF and Indexing activities as part of ETF push Lyxor merges ETF and indexing activities as part of ETF push

Lyxor has reorganised its ETF and indexing activities, creating a new unit dedicated to “ETF & Indexing” investment solutions. This unit is to be led directly by Alain Dubois, Lyxor chairman. According to the company, the aim of bringing together these two activities is to enhance Lyxor’s development in the ETF market, while merging its ETF business with its non-listed indexing business. The move reflects a “very deep trend” among international clients willing to invest in a wide range of ETFs and indexing products.