Vanguard has expanded its European suite of low-cost exchange-traded funds (ETFs) with the launch of four new funds on the London Stock Exchange. The new ETFs complement the firm’s existing London-listed line-up, which debuted in May 2012. Axel Lomholt, Vanguard’s Head of International Product Development, said: “In the US, Vanguard has been very successful in this area, gathering nearly $290 billion of assets since its first ETF launch in 2001. We think that the same low-cost, straightforward approach will prove equally popular in Europe”.
‘ HSBC ’
Standard Life recently revealed plans to enhance its wrap platform aimed at UK financial advisers. One of the key upgrades scheduled over the next 12 months is to deliver improved access to exchange-traded funds (ETFs). The move to enhance access to ETFs is reflective of the growing interest in the product since the introduction of the Retail Distribution Review (RDR).
The potential of emerging markets (EM) is well understood, underpinned by superior growth and robust credit fundamentals. But with recent EM equity performance poor, developed market corporates could provide an attractive, alternative gateway to this potential. Stephen Cohen, Head of EMEA Investment Strategy at iShares, says: “The benefits of EM through developed markets are plenty: Some of the highest quality and most stable developed market companies have made great inroads into emerging economies. There will also be less political and foreign ownership risk, and better governance”.
In a recent research report, analysts at AXA Investment Managers came out bullish on Asian emerging market equities, putting it among their top calls. One way to implement this trade is via exchange-traded funds (ETFs) linked to the MSCI Emerging Markets Asia Index (MSCI EM Asia), an index which targets the precise region the AXA analysts are positive on.
Exchange-traded funds (ETFs) linked to the Nikkei, Topix and MSCI Japan finished the week strongly after the Japanese cabinet, led by new Prime Minister Shinzo Abe, approved a 10.3 trillion yen ($116 billion) stimulus package to bolster the country’s long-suffering economy. Topix-based ETFs, such as the Lyxor ETF Japan Topix, have now advanced 24% since 14 November 2012 when elections were announced.
Emerging ASEAN markets such as the Philippines, Indonesia and Thailand continue to offer good opportunities for investors looking for fast-growing economies with robust fundamentals. Significant growth in the size and wealth of the middle-class, combined with an expected acceleration in infrastructure investment, helps build a compelling, multi-year case for the region’s equities. For investors looking to buy into emerging ASEAN, exchange-traded funds (ETFs) provide an effective means of achieving liquid, targeted exposure at low cost.
China and India are the world’s most populous nations and its principal agents of economic growth. In 2013 they are expected to grow by 8.2% and 6.0% respectively, versus 1.5% for developed economies. While both countries deserve a place in most passive long-term growth portfolios, for active ETF investors an overweight position in China in the short term, giving way to India in the longer term, could be how the smart money flows.
HSBC Global Asset Management has added Susquehanna International Securities as a second official market maker for its exchange-traded fund (ETF) product range. The introduction of an additional market marker should improve liquidity and help investors achieve the best possible dealing prices. Susquehanna will work in addition to HSBC Global Markets, providing continuous bid and offer prices on its 25 physically-replicated ETFs.
More than a quarter of professional buyers of exchange-traded funds (ETFs) expect to widen the range of ETF providers they use over the coming three years, according to a survey commissioned by HSBC Global Asset Management. The report supports the assertion that the European ETF buying community wants to diversify across a wider range of providers, with 74% of respondents asserting they would not allocate any more than 20% to one provider, with the average allocation being 15.5%.
S&P Dow Jones Indices has announced the launch of the S&P SMIT 40 Index, an index designed to measure the performance of 40 leading companies from four emerging markets: South Korea, Mexico, Indonesia and Turkey (“SMITs”). Interest in the SMITs has grown as a consequence of a period of strong stock market performance, during which returns of the SMIT countries have surpassed those of the BRICs.