ETF Inflows & Outflows
Performance Leaders & Laggards
Source: ETF Action; flows and performance data as of 6/6/24; performance data excludes leveraged and inverse products
Weekly ETF Reads
Fidelity Piles On Pressure in Looming Revenue Plan for ETF Firms by Emily Graffeo and Katie Greifeld
“We’ve come full circle back to asset managers sharing a portion of their fee revenues with platforms for the privilege of being placed on their shelves.”
Fidelity is winning ETF revenue-sharing deals after its service fee shook the booming industry by Christine Idzelis
“All of this is a battle for economics between the people who control the platforms and the asset managers who want to raise money on the platforms.”
Like Leveraged ETFs? SEC Panel Wants Brokerage Firms to Vet Who Can Trade Such ‘Complex Products.’ by Kenneth Corbin
“We’re attempting to protect a group that has not asked for protection.”
Advisors Pick ETFs Over Stocks for Client Portfolios: Survey by Dinah Wisenberg Brin
“ETFs continue to dominate investment portfolios, both current allocations and in the future.”
Active ETFs Boom as State Street Eyes Record $260 Billion Inflow by Isabelle Lee
“While active funds have raked in roughly $107 billion this year, or 32% of all ETF flows, they still amount to only 7% of the roughly $9 trillion in total ETF assets.”
What we learned from the latest ETH ETF filing dump by Ben Strack
“The 0.19% fee is super low, but I wouldn’t be surprised to see it undercut at some point.”
Cathie Wood’s Ether ETF Pullback Is Likely Due to Fee War by Helene Braun
“I don’t think anyone truly expected the fee war to get that aggressive before we even saw launches.”
Timing for US ether ETF launches depends on how fast issuers can move, SEC chair says by Hannah Lang and Chris Prentice
“Gensler said last year’s court challenge brought by Grayscale Investments which forced the SEC to approve spot bitcoin ETFs in January had influenced its thinking on the ether products.”
ETF Tweet of the Week
The massive success of spot bitcoin ETFs (see “Chart of the Week” below), along with the spot ether ETF drama, has overshadowed a story that could have a significantly greater impact on the asset management industry. Fourteen firms have now filed with the SEC to use the multi-share class structure including names like Fidelity, Dimensional, and Morgan Stanley. This structure would allow managers to offer ETF share classes of existing mutual funds (and vice versa). Just how big could the impact be? Morningstar’s Ben Johnson:
“I tallied the amount mutual fund assets that might be in play in the ETF-as-a-share class story. At just over $4 trillion, the mutual fund assets held across 1,059 unique funds by the 14 filers represented 21.5% of all U.S. mutual fund assets as of the end of April.”
Ben goes on to note that “not all these funds will be candidates for ETF share classes, and not all of their assets will re-locate to ETF share classes if and when they’re bolted on”. Nevertheless, the potential impact to the ETF industry is clearly enormous.
Cboe’s Global Head of ETP Listings, Rob Marrocco, will join me on next week’s ETF Prime to discuss this topic in more detail.
Make that 14.
— Ben Johnson, CFA (@MstarBenJohnson) June 6, 2024
Touchstone has filed to tack ETF share classes onto its mutual funds.
The firm launched its first active ETFs in July 2022 and converted a mutual fund into an ETF in December 2023.
The list of 14 ETF-as-a-share-class filers now includes: Perpetual, DFA, F/m,…
ETF Chart of the Week
Through Thursday, spot bitcoin ETFs had experienced eighteen straight days of inflows (it’s now nineteen straight days after yesterday’s haul). That’s the longest inflow streak since the products debuted in January. The category took in nearly $2 billion in new money last week, including close to $1 billion on Tuesday alone. Overall net inflows are nearing $16 billion and the category is now north of $60 billion.
The iShares Bitcoin ETF (IBIT) became the fastest ETF to hit $20 billion and already holds more than 300,000 bitcoin, or nearly 1.5% of the total bitcoin supply. Both IBIT and the Fidelity Bitcoin ETF (FBTC) are in the top 6 of all ETF inflows this year.
I could go on with various other mind-boggling stats, but you get the point. Spot bitcoin ETFs have been a monumental success.
Source: Bloomberg’s Sidhartha Shukla
