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Thematic ETFs can deliver significant losses, academics find
January 25, 2021--Research shows average returns underperform the market by about 4 percentage points a year
Interest in thematic exchange traded funds has accelerated in recent years, but research shows buyers should beware.
Academics have found that thematic ETFs, which serve specialist investment interests such as biotechnology, renewable energy or gender equality, on average underperform the stock market on a risk-adjusted basis by about 4 percentage points a year for at least five years following their launch.The academics analysed ETFs traded in the US between 1993 and 2019.
A href="https://www.ft.com/content/7e16172e-ce51-4c41-a139-3a796790bbbe" TARGET="_blank">view more
Source FT.com
Cboe To Introduce New Choice Program For ETP Lead Market Makers, Beginning February 1
January 25, 2021-- Designed to help further enhance market quality for Cboe Listed ETPs
Aims to provide lead market makers with greater choice and flexibility in selecting an incentive model
New program is developed in close consultation with ETP industry participants
Builds upon success of Cboe's previous LMM incentive offerings
Cboe Global Markets, Inc. (Cboe: CBOE), a market operator and global trading solutions provider, today announced plans to introduce a new incentive program that aims to help further enhance market quality for primarily listed exchange-traded products (ETPs) on Cboe BZX Exchange, beginning Monday, February 1, subject to regulatory review.
Previously, Cboe had offered the market's first-of-its-kind incentive program that awarded lead market makers (LMMs) a flat daily fee, rather than payment based on assigned ETPs' transaction volume, to help incentivize LMMs to provide liquidity in newly launched or thinly traded ETPs.
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Source: Cboe Global Markets, Inc.
U.S. Senate votes overwhelmingly to confirm Yellen as first female Treasury chief
January 25, 2021--Janet Yellen won overwhelming Senate confirmation as the first woman to lead the U.S. Treasury on Monday, setting her quickly to work with Congress on coronavirus relief, reviewing U.S. sanctions policy and strengthening financial regulation.
The Senate voted 84-15 to confirm Yellen, with all opposition coming from Republicans, several of whom have expressed concerns about President Joe Biden's proposed $1.9 trillion coronavirus aid plan, tax hikes and other spending initiatives.
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Source: reuters.com
BlackRock Gives 2 Funds Go-Ahead to Invest in Bitcoin Futures
January 20, 2021--The world's largest asset manager appears to be getting into the bitcoin game.
BlackRock, the world's largest asset manager with $7.81 trillion under management, appears to have granted at least two of its funds the ability to invest in bitcoin futures.
Prospectus documents filed with the U.S. Securities and Exchange Commission Wednesday indicate that BlackRock Global Allocation Fund Inc. and BlackRock Funds V are at least eyeing bitcoin. They both include the world's oldest cryptocurrency on their lists of derivative products cleared for use.
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Source: coindesk.com
Yellen Gets Wall Street Buzzing About 50-Year U.S. Treasuries
January 19, 2021--Biden's pick for Treasury secretary was non-committal on topic
Traders sold 30-year bonds in response, steepening yield curve
All it took was a non-committal comment from Janet Yellen to persuade Treasury traders there’s a chance the U.S. will finally expand maturities in the world's biggest bond market beyond 30 years.
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Source: bloomberg.com
Gabelli Funds to Launch Actively Managed ETF Love Our Planet & People (LOPP)
January 19, 2021--GAMCO Investors, Inc. ("GAMCO") (NYSE: GBL) announced today that the registration statement for The Gabelli ETFs Trust, which includes nine Precidian ActiveShares actively managed ETFs, was declared effective by the Securities and Exchange Commission.
Gabelli Funds' launch of Love Our Planet & People will reflect our mandate to invest in companies committed to sustainable practices such as renewable energy and the reduction or recycling of long-lived wastes such as plastics.
The LOPP team has extensive experience researching and investing in companies involved in forward-looking sectors including renewable power generation (wind, solar, water), electric transmission and storage, electric mobility, waste reduction and recycling, water conservation and treatment, and human nutrition throughout the world.
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Source: GAMCO Investors, Inc
SEC-Fee Rate Advisory #2 for Fiscal Year 2021
January 15, 2021--The Securities and Exchange Commission today announced that starting on February 25, 2021, the fee rates applicable to most securities transactions will be set at $5.10 per million dollars.
Consequently, each SRO will continue to pay the Commission a rate of $22.10 per million for covered sales occurring on charge dates through February 24, 2021, and a rate of $5.10 per million for covered sales occurring on charge dates on or after February 25, 2021.
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Source: SEC.gov
Competition for Attention in the ETF Space
January 14, 2021--Abstract
Exchange-traded funds (ETFs) are the most prominent financial innovation of the last three decades. Early ETFs offered broad-based portfolios at low cost. As competition became more intense, issuers started offering specialized ETFs that track niche portfolios and charge high fees. Specialized ETFs hold stocks with salient characteristics--high past performance, media exposure, and sentiment--that are appealing to retail and sentiment-driven investors.
After their launch, these products perform poorly as the hype around them vanishes, delivering negative risk-adjusted returns. Overall, financial innovation in the ETF space follows two paths: broad-based products that cater to cost-conscious investors and expensive specialized ETFs that compete for the attention of unsophisticated investors.
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Source: papers.ssrn.com
BlackRock assets surge to record $8.68tn
January 14, 2021--BlackRock's assets under management swelled to a peak of $8.68tn in the fourth quarter as robust financial markets led by a record run in equities helped the world's biggest fund manager eclipse revenue and profit forecasts.
New York-headquartered BlackRock said on Thursday that revenue rose 13 per cent year-on-year to $4.48bn, while net income climbed by a fifth to $1.57bn.
The company reported earnings per share of $10.18 on an adjusted and diluted basis for the fourth quarter, beating expectations of $9.19 from analysts polled by Bloomberg. Revenue of $4.48bn also beat analyst estimates of $4.31bn.
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Source: dailyuknews.com
Banks, insurers move to shape climate debate as Washington crackdown looms
January 13, 2021--The organizations described their "clear mandate" on climate finance in an unreleased and yet-to-be finalized report that they've been assembling since Joe Biden secured the presidency.
Some of the country's biggest banking and insurance trade groups are poised to pledge trillions of dollars in financing to fight climate change in a move that could give them greater clout in the debate as Democrats step up scrutiny of Wall Street's role in global warming.view more
Source: politico.com
