All entries by this author

What’s in a name? For European ETFs, a lot of confusion

Sep 29th, 2016 | By
Simon Barriball, Head of ETP Trading Europe at ITG

By Simon Barriball, Head of ETP Trading Europe at ITG.

The name should say it all “Exchange Traded Fund”. You would reasonably expect that a fund describing itself as an Exchange Traded Fund would do just that – trade on exchange. The reality in Europe is quite different. Best estimates of European trading are that 50-70% of all ETF trading is off exchange on an OTC basis. One could therefore argue that ETFs fail to live up to their name. We should ask why this is and does it really matter?

Study reveals varying ETF preferences of older and younger investors

Sep 6th, 2016 | By
Study reveals varying ETF preferences of older and younger investors – Millenials vs Gen X vs Baby Boomers

Online broker E*Trade has published a study showing how exchange-traded fund preferences vary by age. Based on a survey of 946 self-directed active investors with at least $10,000 in an online account, it found that Millennials are more likely than Baby Boomers to show interest in a range of less mainstream ETFs, including commodity and foreign currency ETFs. Boomers, meanwhile, prefer dividend ETFs over any other type. Similarly, Millennials are interested in style ETFs, such as growth or value, and those focused on different market-cap brackets, such as mid- or small-cap, while Boomers are distinctly less keen.

ETFs largely unmoved by Jackson Hole speech

Aug 30th, 2016 | By
ETFs largely unmoved by Jackson Hole speech

The case for raising US interest rates has “strengthened”, the chairwoman of the Federal Reserve has said. Speaking at the Fed’s annual meeting at Jackson Hole, Wyoming, Janet Yellen was cautiously positive on the US economy and said “the case for an increase in the federal funds rate has strengthened in recent months”. Yellen’s comments have not come as much of a surprise, however, and ETFs were fairly quiet following the speech, with few major moves directly triggered by her comments. ETFs tracking the US utilities sector, such as SSGA’s $8 billion NYSE-listed Utilities Select Sector SPDR ETF (XLU), were perhaps the most obvious casualties of the speech, falling around 2.5%.

ETFs continue to attract the money

Aug 23rd, 2016 | By
ETFs continue to attract the money - John Redwood

John Redwood, Charles Stanley’s Chief Global Strategist, looks at the rising popularity of exchange-traded funds.

By the end of June this year, exchange-traded funds (ETFs) had swollen to more than $3 trillion worth of investments. In recent years more individuals and institutional investors have built portfolios around ETFs. More institutions have used ETFs to gain exposure rapidly to a given asset class or geographical area. More have introduced some ETFs into portfolios where they lack the expertise on the individual shares or commodities or properties they might otherwise buy.

EM rally has legs to run, says PIMCO

Aug 19th, 2016 | By
PIMCO: A new phase in the cold currency war

By Joachim Fels, PIMCO’s global economic advisor
From negative interest rates to Brexit to the Fed, investors have understandably been preoccupied with matters at hand lately. But it may be a good time to shift focus and look longer term: Over the past few years, emerging markets (EM) have been quietly undergoing positive, fundamental change that we think will likely increase value in the asset class.

PIMCO: Regulation and Demographics – Two Factors Behind the Rise of Sustainable Investing

Aug 18th, 2016 | By
PIMCO: Regulation and Demographics - Two Factors Behind the Rise of Sustainable Investing

By Kwame Anochie, Account Manager and Alex Struc, Portfolio Manager at PIMCO.

Investors globally are becoming more engaged with the environmental, social and governance (ESG) factors that affect the well-being and smooth functioning of the global economy and markets. The widespread endorsement of the United Nations Principles for Responsible Investing initiative, which has over 1,500 signatories from over 50 countries, is a key example. Two primary drivers of this trend toward more sustainable investing are the changing demographic landscape and increased regulatory focus.

PIMCO: China – Are investors tapping the brake?

Jul 14th, 2016 | By
PIMCO: China - Are investors tapping the brake?

By Luke Spajic, executive vice president and portfolio manager.
MSCI’s recent decision to delay including China’s local shares in its widely tracked emerging markets equity index reflects the views of its clients: namely, the global investors who use the index as a benchmark for constructing portfolios and measuring their performance. To put the decision in perspective, China has the second-largest equity market in the world, and global investors will inevitably face the task of integrating these assets into their portfolios. But with the MSCI announcement, investors may be saying, “not yet.”

With downside risks rising, more volatility looms for global markets: BlackRock

Jul 12th, 2016 | By
BlackRock: What’s next for China’s economy?

More volatility looms for the global markets, torn between anxiety over the fallout of the UK’s vote to exit the European Union (Brexit) and the prospect of a strengthening U.S. economy, according to the 2016 Mid-Year Global Investment Outlook from BlackRock Investment Institute (BII). BlackRock is the parent of exchange-traded fund provider iShares.

Global ETF AUM set to exceed $7 trillion by 2021, says PwC

Jul 11th, 2016 | By
Global ETF AUM set to exceed $7 trillion by 2021, says PwC

Global professional services firm PwC expects accelerated growth in exchange-traded funds (ETFs) over the next five years, with global assets under management (AUM) anticipated to exceed $7 trillion by 2021. A new report, ‘ETFs: A roadmap to growth’ predicts the market will achieve further significant growth through entering new markets, expanding distribution channels and asset classes. The firm expects the North American ETF market to grow to $5.9 trillion in AUM by 2021 (a 23% cumulative annual growth); the European market to grow 27% annually – reaching $1.6 trillion AUM by 2021; and the Asian ETF industry to reach $560 billion in AUM by 2021 – an 18% annual growth rate over five years.

Mitigating climate change with sustainable investments

Jul 6th, 2016 | By
Giulio Castelli

By Giulio Castelli, Head of Product Development at STOXX.

Last year 196 countries agreed to limit global warming to less than two degrees at the United Nations Climate Change Summit in Paris. Though primarily a political signal, the agreement has increased pressure on companies along with investors. In order to keep to the two-degree-goal, greenhouse gas emissions need to be zeroed within the next 30 to 45 years. A major message of the climate change conference was that carbon emissions will no longer be economically justifiable in any business model in the not too distant future. Long-term investors in particular need to take notice of this.