Global ETF News Older than One Year
iShares-Four Big Trends Driving ETF Growth-Global ETF assets could reach $12 trillion over five years
June 5, 2018--Exchange traded funds (ETFs) are the most enduring investing trend in a generation. This century began with fewer than $100 billion in ETF assets and now counts $4.7 trillion across an ever-expanding number of products.1
Expect growth to accelerate. As detailed in the full report, sweeping developments within the investment management industry are putting ETFs on course to potentially gather more assets over the next five years than in the previous 25 years combined.2
Global ETF assets are poised to more than double to $12 trillion by the end of 2023 and possibly reach $25 trillion by the end of 2027.3
Four trends are likely to fuel future ETF growth, especially in the U.S. and Europe:
ETF investors are active investors. ETFs are increasingly used in portfolios to seek outcomes that differ from the broad market. Investors are likely to step up their use of ETFs as building blocks in asset allocation and as vehicles to deliver factor-based investment strategies that seek to emphasize persistent drivers of return.
Source: BlackRock
ETFGI reports assets invested in active ETFs and ETPs listed globally reach record high of 86 billion US dollars at the end of April 2018
June 5, 2018--ETFGI, a leading independent research and consultancy firm on trends in the global ETF/ETP ecosystem, reported today that assets invested in active ETFs and ETPs listed globally reached a record high of US$86.09 Bn at the end of April 2018; an increase in assets of US$3.11 Bn from the previous record of US$82.97 Bn set at the end of March 2018. (All dollar values in USD unless otherwise noted.)
Highlights
Assets invested in actively-managed ETFs/ETPs listed globally increased by $3.11 Bn during April to reach a new record high of $86.09 Bn
In April 2018, actively-managed ETFs/ETPs listed globally saw net inflows of $2.75 Bn
Active fixed income ETFs performed well this month, with assets invested in the PIMCO Enhanced Short Maturity Strategy Fund (MINT US) reaching a new record high of $8.99 Bn
Source: ETFGI
ETFGI reports assets invested in Currency Hedged ETFs and ETPs listed globally decreased by 1.1% year to date through end of April 2018
June 5, 2018--According to ETFGI's April 2018 Currency Hedged ETF and ETP industry insights report, a monthly report included in an annual paid-for research subscription service, assets invested in currency hedged ETFs/ETPs reached US$143.94 Bn at the end of April 2018, decreasing by 1.1% from US$146.14 Bn in December 2017. (All dollar values in USD unless otherwise noted.)
Highlights
Year-to-date, assets invested in currency hedged ETFs/ETPs decreased by $2.20 Bn
In April 2018, assets invested in currency hedged ETFs/ETPs saw net outflows of $371 Mn
Source: ETFGI
Paper-The Economic Limits of Bitcoin and the Blockchain
June 5, 2018--Abstract
The amount of computational power devoted to anonymous, decentralized blockchains such as Bitcoin's must simultaneously satisfy two conditions in equilibrium: (1) a zero-profit
condition among miners, who engage in a rent-seeking competition for the prize associated with adding the next block to the chain; and (2) an incentive compatibility condition on the
system's vulnerability to a "majority attack", namely that the computational costs of such an attack must exceed the benefits.
Together, these two equations imply that (3) the recurring, "flow", payments to miners for running the blockchain must be large relative to the one-off, "stock", benefits of attacking it. This is very expensive! The constraint is softer (i.e., stock versus stock) if both (i) the mining technology used to run the blockchain is both scarce and non-repurposable, and (ii) any majority attack is a "sabotage" in that it causes a collapse in the economic value of the blockchain; however, reliance on non-repurposable technology for security and vulnerability to sabotage each raise their own concerns, and point to specific collapse scenarios. In particular, the model suggests that Bitcoin would be majority attacked if it became sufficiently economically important-e.g., if it became a "store of value" akin to gold-which suggests that there are intrinsic economic limits to how economically important it can become in the first place.
Source: Eric Budish-faculty.chicagobooth.ed
ETF Securities Weekly Flows Analysis-Gold's safe haven status reignited by fears of 'Quitaly' and trade tariffs
June 4, 2018--Gold ETPs took the lion's share of inflows as Italy's political chaos and trade tariffs took centre stage
Diversified basket ETPs draw in US$46mn of inflows as investors appear to rotate back into commodities
Energy sector ETP flows bifurcate-energy baskets attract inflows while crude oil ETPs suffer outflows
Gold ETPs took the lion's share of inflows, garnering inflows worth US$122.7mn, marking its highest level in 33 weeks. A turbulent week in Italian politics coupled with the intensification of US trade tariffs supported a reversal in trend of the priors two weeks of outflows among gold ETPs. Fears of a new round of elections in Italy sparked by the rejection of the candidate for the economic and finance minister by President Sergio Mattarella widened the gap between yields on the ten year Italian and German government bonds to over 250 Basis Points (Bps), its highest level since October 2013.
Source: ETF Securities
Total virtual currency sales jump in 2018 but monthly trend slows: report
June 4, 2018--Virtual currency sales ballooned to $9.1 billion so far this year, exceeding the $6.6 billion total for all of 2017, a financial technology data provider reported on Monday, but it said the monthly trend actually showed a slowdown if the two biggest offerings are excluded.
Digital technology startups around the world have raised funds by selling cryptocurrencies, or tokens, that sidestep banks or venture capital firms as intermediaries.
Source: Reuters
ETFGI reports assets invested in the global ETF industry extended lead over hedge fund industry to US$1.70 trillion at the end of Q1 2018
June 1, 2018--ETFGI, a leading independent research and consultancy firm on trends in the global ETF/ETP ecosystem, reported today that assets invested in the global ETF/ETP industry extended their lead over assets invested in the global hedge fund industry to US$1.70 trillion at the end of Q1 2018, an increase of 4.91% over the gap at the end of Q4 2017. (All dollar values in USD unless otherwise noted.)
Assets invested in global ETF/ETP industry extend lead over assets in global hedge fund industry to $1.70 Tn at the end of March 2018
Record $4.92 Tn invested in 7,389 ETFs/ETPs listed globally at the end of March 2018
Record $3.22 Tn invested in 8,379 hedge funds globally at the end of March 2018
1.74% growth in assets invested in ETFs/ETPs over Q1 2018 outpaces 0.13% growth in assets in hedge funds over the same period. In contrast, growth over Q1 2017 was 10% and 2%, respectively.
Source: ETFGI
DECPG Global Weekly
June 1, 2018--TAKING STOCK
U.S. Q1 GDP growth revised slightly down; nonfarm job growth strengthened in May; PCE inflation remained steady
U.S. government announced new import tariffs on major trading partners
Euro Area inflation picked up in May; unemployment rate fell in April
China's official manufacturing PMI picked up in May
Financial markets were negatively affected by political uncertainty in Italy
Source: World Bank
Use of behavioural insights may help educate investors, say IOSCO/OECD
May 31, 2018--Financial regulators, public authorities, and other organisations are increasingly using behavioural insights to educate investors to make more informed financial decisions, according to a report published today by the International Organization of Securities Commissions (IOSCO) and the Organisation for Economic Co-operation and Development's International Network on Financial Education (OECD/INFE).
The accelerated growth of new and innovative technologies, an excessive amount of available financial information, and increasingly sophisticated financial products make it progressively more difficult for retail investors to navigate today's complex financial markets. Although many organisations offer education and financial literacy programs, investors often fail to make rational financial choices because of their own cognitive, social and psychological biases-all of which can act as barriers to sound financial decision making.
Source: IOSCO
Investing in the global green economy: Busting common myths
May 31, 2018--Executive summary
Until now the transition to a sustainable and "green" economy1 has been a loose concept rather than a defined, investable, industrial system. This lack of definition and data has led to the impression that it is of limited size; small cap dominated; lacking diversification and that investors give up performance in exchange for environmental benefits.
However, analysis by FTSE Russell dispels these stereotypes. It finds a large investment opportunity, backed by global efforts to combat climate change and broader environmental challenges. The opportunity is diversified across company size, geography and sector and has delivered outperformance of the global equity market.
Key features of the green economy
Based on FTSE Russell's calculations:
It's substantial: The green economy represents 6% of the market capitalization of global listed companies, approximately US$4 trillion. This represents a significant investment opportunity, approximately the same size as the fossil fuel sector.
It's growing: The green economy proportion of the global market capitalization is growing, while the fossil fuel sector shrinks.
It's diversified: The green economy is diversified by company size. While small and mid cap companies have a greater green exposure and represent a larger number of green companies the market is by no means small and mid cap dominated; large cap companies represent approximately two thirds of green market capitalization.
Source: FTSE Russell
