ETF Inflows & Outflows
Performance Leaders & Laggards
Source: ETF Action; flows and performance data as of 10/26/23; performance data excludes leveraged and inverse products
Weekly ETF Reads
How the ETF industry is reshaping the investment landscape by Kathie O’Donnell
“We are living right now in the middle of an institutional revolution when it comes to ETFs.”
Why the future looks bright for ETFs by Devin McGinley
“ETFs have proliferated to offer every investment style on the market.”
ETFantasmagoria by Robin Wigglesworth
“If we go too far as an industry, people will have doubts about the original construct.”
Wine: Too illiquid for ETFs? by Tom Eckett
“Wine is, ironically, a relatively illiquid asset.”
Are JEPI Investors Learning The Hard Way What This ETF Actually Is? by David Dierking
“It’s very likely that we’ve passed peak positive sentiment with JEPI and we could see flows stagnate for a while.”
The 10 Commandments of ETFs by Cinthia Murphy
“The ETF industry is not a place concerned with intellectual property protections.”
Cage Match: Traditional Index Funds vs. ETFs by Christine Benz & Margaret Giles
“In 2022, U.S. investors poured $600 billion into ETFs, while traditional index funds received only $60 billion in new assets.”
Fidelity Aims To Break Into An ETF Market Dominated By Vanguard by Miles Weiss & Emily Graffeo
“Vanguard only received the clearance to apply the structure to index funds. Its filing to use ETF share classes in active strategies failed to get approval from the SEC.”
Investors look beyond largest emerging markets ETFs by Ari Weinberg
“ETF investors have become more comfortable straying from large, low-cost, cap-weighted products from Vanguard Group and BlackRock into more finely tuned exposures, including those that are actively managed.”
Crypto ETF skepticism echoes past fears of ETFs themselves: Bitwise CIO by Darren Kleine
“History always repeats — and it’s repeating with crypto.”
What would a spot bitcoin ETF approval mean for the industry? by Brian McGleenon
“You will have a new layer of trading activity on top of the base layer, which will likely be options trading on the ETF.”
ETF Tweet of the Week
The spot bitcoin ETF saga has more twists and turns than a Quentin Tarantino flick. Two weeks ago, a large number of “X” accounts and media tripped over themselves after excitedly reposting a false tweet from a random crypto website claiming the SEC had approved the iShares Bitcoin ETF. This past week? Well, a large number of “X” accounts and media breathlessly posted about how the iShares Bitcoin ETF is now “listed on” the DTCC, which apparently means a launch is imminent. As an aside, I wonder how many people actually know what “DTCC” stands for? It means Depository Trust and Clearing Corporation if you are, in fact, curious. In any event, the problem was that nobody thought to actually ask the DTCC what the iShares ETF “listing” meant. When Reuters finally did, they learned the following:
“The clearing house said the list was its eligibility file, which includes active and potential ETFs and that Blackrock’s iShares Bitcoin Trust ETF was added in August as ‘standard practice…in preparation for the launch of a new ETF’. Appearing on the list is not indicative of an outcome for any outstanding regulatory or other approval processes.”
In other words, the ETF had been added to the DTCC file in AUGUST(!) – not this past week – and doesn’t indicate a launch is happening anytime soon. ETF industry veteran Phil Bak had an even better response to this entire situation.
My brothers in bitcoin:
— Phil Bak 🎩 (@philbak1) October 24, 2023
I spent six years managing new ETF launches for NYSE (2010-2016), and about 15 years in ETF product development and management.
The DTCC thing means absolutely nothing. Nothing. Get offline and spend time with your loved ones.
ETF Chart of the Week
Charles Schwab’s latest ETF investor survey found that younger investors continue gravitating towards the vehicle. From Schwab’s press release:
“Millennials’ love of ETFs continues to outpace other generations across several measures. They continue to be more heavily invested in ETFs, with 37% of their portfolios in ETFs. Eighty-nine percent say ETFs are their investment vehicle of choice and about a quarter of Millennials (22%) plan to significantly increase their investments in ETFs in the next year. Millennial ETF investors are broadly comfortable with ETFs, with 99% reporting they are extremely confident in their ability to choose an ETF that can help achieve their investment objectives.”
The simple takeaway is that ETFs are the default option for younger individuals whose investable assets will only increase, which means the future of the industry remains extremely bright. Explore the full survey findings here.
Source: Charles Schwab
