Global ETF News Older than One Year
IOSCO consults on ESG Ratings and Data Providers
July 26, 2021--The Board of the International Organization of Securities Commissions (IOSCO) is soliciting feedback on a set of proposed recommendations regarding Environmental, Social and Governance (ESG) Ratings and Data Providers.
The IOSCO Consultation Report on Environmental, Social and Governance (ESG) Ratings and Data Providers (Consultation Report) aims at assisting IOSCO members in understanding the implications of the activities of ESG ratings and data providers and in establishing frameworks to mitigate risks stemming from these activities. In doing so, it proposes a set of recommendations to mitigate these risks and address some of the challenges faced by users of products and services from ESG ratings and data providers, and the companies that are the subject of these ESG ratings and data products.
Source: IOSCO
ETFGI reports record assets and net inflows for Smart Beta ETFs and ETPs listed in globally of US$1.24 trillion and US$102.03 billion respectively at the end H1 2021
July 19, 2021-- ETFGI, a leading independent research and consultancy firm covering trends in the global ETFs/ETPs ecosystem, reports record assets and net inflows for Smart Beta ETFs and ETPs listed in globally of US$1.24 trillion and US$102.03 billion respectively at the end H1 2021.
Smart Beta ETFs and ETPs providing equity exposure listed globally gathered net inflows of US$14.27 billion during June, bringing year-to-date net inflows to a record US$102.03 billion which is higher than the US$12.36 billion gathered at this point last year.
Year-to-date through the end of June 2021, Smart Beta Equity ETF/ETP assets have increased by 23.8% from US$999 billion to US$1.24 trillion, with a 5-year CAGR of 22.8%, according to ETFGI's June 2021 ETF and ETP Smart Beta industry landscape insights report, a monthly report which is part of an annual paid-for research subscription service. (All dollar vales in USD unless otherwise noted.)
Highlights
Record $1.24 Tn invested in Smart Beta ETFs and ETPs industry at end of H1 2021.
Assets have increased 23.8% in H1 going from $999 Bn at end of 2020 to $1.24 Tn.
Record H1 net inflows of $102.03 Bn beating prior record of $44.77 Bn gathered in H1 2015.
$102.03 Bn H1 net inflows are $49.71 Bn greater than the full year 2020 record net inflows $52.32 Bn.
$142.72 Bn in net inflows gathered in the past 12 months.
11th month of consecutive net inflows
Equity Smart Beta ETFs and ETPs listed gathered a record $102.03 Bn in net inflows in H1 2021.
Source: etfgi.com
Carbon Market Could Drive Climate Action
July 19, 2021--Trading commenced on China's national emissions trading system (ETS) on Friday. With a trading volume of about 4 billion tons of carbon dioxide or roughly 12 percent of the total global CO2 emissions, the ETS is now the world's largest carbon market.
While the traded emission volume is large, the first trading day opened, as expected, with a relatively modest price of 48 yuan ($7.4) per ton of CO2. Though this is higher than the global average, which is about $2 per ton, it is much lower than carbon prices in the European Union market where the cost per ton of CO2 recently exceeded $50.
Source: worldbank.org
ETF industry on track for record year as investor inflows reach $659bn
July 15, 2021--Increased use of exchange-traded products by active managers has given the sector a boost.
Investors are pouring money into exchange traded funds at a historic pace as equity and corporate bond markets rally to new peaks and asset managers increasingly turn to the vehicles to build portfolios.
Source: ft.com
DeFi on Bitcoin: Jack Dorsey says Square's new division will make it happen
July 15, 2021--Jack Dorsey has outlined plans to build an open developer platform focused on creating Bitcoin DeFi services.
Square CEO Jack Dorsey has revealed that the firm is building a new division that will focus on building decentralized finance services that utilize Bitcoin.
Dorsey made the announcement via Twitter earlier today and revealed that Square's new division will be building an 'open developer platform with the sole goal of making it easy to create non-custodial, permissionless, and decentralized financial services. Our primary focus is Bitcoin."
Source: cointelegraph.com
Fintech and the digital transformation of financial services: implications for market structure and public policy
July 13, 2021--Economic frictions such as information asymmetries and economic forces such as economies of scale and scope give rise to financial intermediaries. These frictions and forces also shape market structure. While technological advances are not new to finance, digital innovation has brought major improvements in connectivity of systems, in computing power and cost, and in newly created and usable data. These improvements have alleviated transaction costs and given rise to new business models and new entrants.
As technology has increased information exchange and reduced transaction costs, the production of financial services could be disaggregated. Specialized players have unbundled financial services, allowing consumers to find and assemble their preferred suites of products.
However, classic economic forces remain relevant even in an age of digital production. Economies of scale and scope and network effects are present in many aspects of financial services production, including customer acquisition, funding, compliance activities, data and capital (including trust capital). Despite advances in technology, consumer search and assembly costs remain significant. These forces encourage re-bundling, and confer advantages to large multi-product providers, including technology (big tech) firms expanding into financial services from adjacent markets.
Source: BIS
Listed Companies Have Less Than Six Years to Align With 1.5 degree C Warming Target, Inaugural MSCI Net-Zero Tracker Reveals
July 12, 2021--Launch of quarterly MSCI Net-Zero Tracker will show progress of listed companies towards the goals of the Paris Agreement and highlight climate leaders and laggards
The world's publicly listed companies must dramatically accelerate climate action if the 1.5°C warming target set out in the 2015 Paris Agreement is to be met, according to a new quarterly Net-Zero Tracker published by MSCI, a leading provider of critical decision support tools and services for the global investment community.
The inaugural Net-Zero Tracker highlights how the annual emissions of listed companies globally are still at the same level as 2013, despite concerted efforts to place climate change at the top of the global agenda. This includes the 2015 Paris Agreement which set a goal to limit global warming to below 2°C, with 1.5°C the preferred target.
Source: MSCI Inc.
The quest for the investment Holy Grail-an index of everything
July 12, 2021--Financial benchmarking giant MSCI is working on the "ultimate index" to track the performance of all markets. This could be the culmination of half a century of academic theory and practical financial engineering.
Indexing is a booming business that slices the market into regions or categories such as equities and fixed income, further subdividing by size or industry.
These are used as benchmarks for fund managers or packaged into investable products. However, the method of combining everything from commodities to venture capital into one gauge has proven to be elusive.
"It’s the Holy Grail," says Mark Makepiece, head of index provider Wilshere. "It will solve the core problems of investment and will be very beneficial."
Source: californianewstimes.com
Historic trend reverses as ETF fees head higher
July 12, 2021--Price war had caused a long period of decline, but that may now be coming to an end
Management charges for exchange traded funds have stopped falling, and in some cases started to rise for the first time, potentially signalling an end to a multi-decade trend of ever-lower fees.
A ferocious price war caused asset-weighted annual fees for US-listed ETFs to tumble 43 per cent to 19 basis points between 2012 and 2020, according to calculations by JPMorgan.
Source: ft.com
Trackinsight Global ETF Survey: Mid-Year Update Reveals Mixed Fortunes for Vanguard
July 12, 2021--The update includes re-ranked league tables for ETF issuers and index providers alongside new commentary and analysis on thematic, ESG and active ETF market activity.
The update reveals that the North American ETF market, which reached $5.8 Trillion in AuM in Q1 2021, saw growth dominated by Vanguard. The issuer captured over 42% of total flows in the region, adding an incredible $95 Billion in the first quarter. Total ETF flows in North America were $218 Billion over the quarter.
Source: trackinsight.com
