Tradeweb’s European ETF market smashes previous trading record in February

Mar 12th, 2018 | By | Category: ETF and Index News

Trading activity on Tradeweb’s European ETF marketplace reached a record-breaking €24 billion in February, up 20% from the previous record of €20bn set in January 2018.

Adriano Pace, managing director for equity derivatives at Tradeweb.

Adriano Pace, managing director for equity derivatives at Tradeweb.

Commenting on February’s record performance figures, Adriano Pace, managing director for equity derivatives at Tradeweb, said: “Enhanced best execution requirements under MiFID II have highlighted the benefits of transacting ETFs on electronic trading venues like Tradeweb. Investment firms must now take sufficient steps to achieve the best possible results for their clients in terms of price, costs, speed and likelihood of execution.

“E-trading helps institutional investors meet these obligations thanks to inherent features such as RFQ-based price discovery, improved access to liquidity, STP workflow efficiencies, and comprehensive audit trails logging each step of the trade lifecycle.”

Equity ETFs accounted for 63% of overall platform flow, one percentage point higher than the asset class’s 12-month rolling average. ‘Sells’ in equity ETFs narrowly outstripped ‘buys’ by 51% to 49%.

Delving deeper into equity flows by region or country, North America emerged as February’s most heavily traded ETF category with more than €4.4bn. Investors were net bullish on the asset category with ‘buys’ outstripping ‘sells’ by 57% to 43%. Emerging Market ETFs were the only other equity-based category to see net buying during the month.

Fixed income ETFs were the only asset class to see net buying as buying exceeded selling by 53% to 47%. Nearly €2bn was executed in corporate bond ETFs, the most active fixed income segment during the month with ‘sells’ outpacing ‘buys’ by 55% to 45%. Fixed income ETF trading amounted to a third of total platform flow, in line with its 12-month rolling average.

Trading activity in commodity ETFs dropped to 4% of the platform’s total traded volume, one percentage point below its 12-month rolling average.

Source: Tradeweb.

The share of transactions processed using Tradeweb’s Automated Intelligent Execution tool (AiEX) increased to 36.4%, beating January by more than seven percentage points.

Top ten ETFs by traded volume

The Xtrackers MSCI World Index UCITS ETF (XMWO GR) was February’s most actively-traded ETF. The synthetically replicated fund, which provides exposure to large- and mid-cap stocks from 23 developed market countries, reclaimed the top spot it last occupied in October 2017.

The fund tracks the MSCI World Index, trades in euros, and has a total expense ratio (TER) of 0.45%.

Source: Tradeweb.

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