ETF Inflows & Outflows
Performance Leaders & Laggards
Source: ETF Action; flows and performance data as of 1/18/24; performance data excludes leveraged and inverse products
Weekly ETF Reads
Industry news flow remains dominated by spot bitcoin ETFs. The hype around this story will slowly start to fade, but for now – it’s another spot bitcoin ETF-heavy weekly buzz.
Bitcoin E.T.F.s Come With Risks. Here’s What You Should Know. by Tara Siegel Bernard
“Putting crypto into a traditional investment wrapper does not paper over the underlying risks.”
Coinbase at the Center of Bitcoin ETF Draws Envy and Risks by Yueqi Yang & Olga Kharif
“The ETFs are likely to diversify to use multiple custodians over time, as they wish to reduce their reliance on a single company.”
Should You Buy A Spot Bitcoin ETF? by Allan Roth
“Will it become the new digital gold or go the way of the tulips during the famed Dutch Tulip bubble of the 1600s?”
Vanguard Got Bitcoin Right by John Rekenthaler
“Whether Vanguard has selected the right ground onto which to make its stand remains to be seen.”
Investors pump record sums into bond and ‘quality’ stock ETFs by Steve Johnson
“We are still in the early stages of fixed income ETF adoption globally.”
After VettaFi … by Dave Nadig
“Virtually everything interesting in markets now flows through the ETF ecosystem.”
ETF Tweet of the Week
Lost in the spot bitcoin ETF hype was a milestone decades in the making. Passive US-based mutual funds and ETFs officially eclipsed their active counterparts. Obviously, the definition of “passive” has evolved over the years (think “smart beta” ETFs). Nevertheless, a combination of lower fees and active manager underperformance has conspired to produce what I call the “fund flippening”. ETFs have been a clear catalyst:
“The steady growth of passive management in the US funds industry owes a debt to the durable appeal of ETFs.”
Assets in U.S.-domiciled index mutual funds and ETFs have eclipsed assets in actively managed funds for the first time.https://t.co/3D5a43cXkd pic.twitter.com/B1ujlSppCB
— Ben Johnson, CFA (@MstarBenJohnson) January 18, 2024
ETF Chart of the Week
With 10 spot bitcoin ETFs now available for investors to choose from, ETF due diligence is back in the spotlight. What are the most important factors when selecting among the various options?
There are numerous items to consider including fees, spreads/liquidity, premiums/discounts, issuer expertise, closure risk, and custody arrangements. I had an opportunity to opine on these with Bloomberg’s Claire Ballentine.
Interestingly, a recent VettaFi poll of advisors and investors found that issuer expertise – and not fees(!) – was the most important selection criteria. VettaFi’s Todd Rosenbluth and I discussed these results on ETF Prime.
Source: VettaFi’s Todd Rosenbluth
