Europe-listed ETFs saw net inflows of €7.8 billion in July 2017, bringing the total for 2017 to €65bn, according to data from Morningstar. While flows into Europe-listed equity ETFs posted a solid reading of €4.9bn, fixed income ETFs saw tepid demand during the month, recording flows of just €1.6bn, the second lowest monthly flows this year.

Torsten Hunke, chief operating officer, VanEck Europe, discusses the investment process behind the Morningstar Wide Moat Focus Index, used to underlie the VanEck Vectors Morningstar US Wide Moat UCITS ETF (LON: MOAT). Hunke explains that identifying stocks with wide economic moats (sustainable competitive advantages) is only half the battle; ascertaining which are trading below their fair values is equally as important.

The iShares $ TIPS 0-5 UCITS ETF has recorded a significant inflow of around $177 million. The newly launched fund, introduced on the London Stock Exchange in April of this year, saw its total assets under management jump on Monday 7th August 2017 to $185m from approximately $7.5m in seed capital.

By Yu-Ming Wang, CIO, Nikko Asset Management.

As China’s economic development enters a more sophisticated and mature phase, it is beginning to challenge many of the status quos that have been taken for granted since the middle of the 20th century. With its large domestic market and huge savings pool, China does not simply follow the rules. China and its companies are becoming increasingly competitive, disrupting many long-established norms by leveraging various competitive advantages such as economies of scale, product differentiation and erecting higher barriers to new entrants.

European-listed ETF market flows remained steady in July with net new assets (NNA) over the month totalling €8.7 billion, according to monthly flows analysis from Lyxor. However, fixed income flows decreased to €2.3bn, close to the lowest monthly level of the year.

European ETF industry veterans Hector McNeil and Nik Bienkowksi have announced the launch of HANetf, Europe’s first independent “white label” UCITS ETF platform. The platform, which is not linked to any existing issuer, will provide third-party asset managers from around the world with the infrastructure to build and launch ETFs into Europe without having to establish their own full-service business. The pair aim to disrupt the market by lowering the barriers to entry for prospective new ETF issuers.

Vanguard has announced a change in indices underlying three of its government bond ETFs. The changes, which are due to take place during the fourth quarter of 2017, will see the ETFs’ underlying indices transition to pure Treasury indices. The move is expected to provide more targeted exposure to segments of the US government bond market and may potentially reduce bid-ask spreads.

Seven Investment Management (7IM) has reported that its gold exposure is currently at its highest ever level due to the firm’s “risk off” positioning as a result of perceived elevated risks in the stock market. 7IM’s gold holdings (15.4 tonnes) is now greater than a number of countries including Ireland, United Arab Emirates and the Czech Republic. The discretionary fund manager uses physically backed exchange-traded commodities (ETCs) from Source and iShares to obtain gold exposure in its range of funds and managed portfolios.

First Trust has become the largest provider of US-listed actively managed ETFs, based on AUM and number of funds offered –
according to data from Morningstar, as of the end of July, First Trust had $9.9bn invested across 29 US-listed actively managed ETFs. Ryan Issakainen, ETF strategist at First Trust, said: “First Trust has been highly selective in developing a diversified line-up of actively managed ETFs, focusing on categories where we believe active management offers competitive advantages over passive benchmark indices.”

The ROBO Global Robotics & Automation Index ETF (Nasdaq: ROBO) recently surpassed $1 billion in assets under management (AUM). Launched in October 2013, the ETF was the first to offer thematic equity exposure to companies involved in the production and use of robotics, automation and related technologies.