Markets may be volatile, but firms are still taking advantage of introducing new products via the superior ETF wrapper.

ESMA takes a crack at stock market outages with a new proposal, and Circa5000 has plans to launch 5 new ETFs in Q1 2023.

Fund Launches and Updates

 

EMEA

21Shares AG has listed the 21Shares Bitcoin ETP on Nasdaq Dubai, making it the Middle East’s first physically-backed bitcoin ETP. Reuters

Amundi has launched 10 global ESG sector ETFs with a €600m seeding from a Dutch investor. The new range has listed on the Deutsche Boerse XETRA, all with total expense ratios of 0.18%. ETF Stream

New entrant, Axxion, launched their first ETF, the Frankfurt UCITS ETF Modern Value on Deutsche Boerse XETRA and the Frankfurt Stock Exchange, TER 0.52%. ETF World

Fidelity International has made changes to the actively managed $750 million Fidelity Sustainable Global Corporate Bond Multifactor UCITS ETF, aligning the fund with the carbon reduction goals of the Paris Agreement. ETF Strategy

Goldman Sachs Asset Management has launched the Goldman Sachs Paris-Aligned Climate World Equity UCITS ETF (WRLD) on the London Stock Exchange and the Deutsche Boerse XETRA with a TER of 0.24%. ETF Stream

GraniteShares has launched 23 new products including the first Spotify and MicroStrategy 3xLong and 3xShort ETPs listed on the London Stock Exchange. Finextra

Hashdex has launched the Hashdex Crypto Momentum Factor ETP on the SIX Swiss Exchange. ETF Strategy

Invesco has launched the Invesco US Treasury Bond 10+ Year UCITS ETF (TREL) with a total expense ratio of 0.06% and is listed on London Stock Exchange, Deutsche Boerse XETRA, SIX Swiss Exchange and the Borsa Italiana.  ETF Stream

JP Morgan Asset Management has liquidated the $13.6m JP Morgan ETFs US Equity Multi-Factor UCITS ETF (JPUS) which launched in July 2019. ETF Stream

Valour has partnered with crypto index provider Vinter to launch the Valour Digital Asset Basket 10 Index (VDAB10) which is listed on the Deutsche Boerse XETRA with a total expense ratio of 1.90%. ETF Stream

Vanguard has expanded its range of ESG ETFs with the launch of the Vanguard ESG Emerging Market All Cap UCITS ETF (V3MM) and the Vanguard ESG Developed Asia Pacific All Cap UCITS ETF (V3PA).

Both are listed on the London Stock Exchange, Deutsche Boerse XETRA, Borsa Italiana, Six Swiss Exchange and Euronext Amsterdam. ETF Stream

 

AMERICAS

In Canada, Desjardins Global Asset Management launched the Desjardins Alt Long/Short Global Equity Markets ETF and the Desjardins Alt Long/Short Equity Market Neutral ETF. Yahoo

In the U.S., Franklin Templeton’s only portfolio-shielding ETF will make its holdings fully public by the middle of December. The fund’s board voted to change the $3.2mn ClearBridge Focus Value ESG ETF from an ActiveShares non-transparent ETF to a conventional transparent ETF by December 16.

Toroso Investments has launched a new actively managed US equity ETF that explicitly avoids companies with political or social agendas that are unrelated to their business operations.

The God Bless America ETF (YALL US) has been listed on NYSE Arca with an expense ratio of 0.65%. ETF Strategy

Valkyrie Funds is closing and delisting its Valkyrie Balance Sheet Opportunities ETF (VBB), which launched last December. Investors.com

Victory Capital Management Inc., has launched a new active ETF, VictoryShares WestEnd U.S. Sector ETF (MODL). Businesswire

New ETF entrant, Unlimited Funds, has launched the Unlimited HFND Multi-Strategy Return Tracker ETF on the NYSE Arca exchange. PI Online

Full list of U.S. launches:

 

ASIA-PACIFIC

Australia’s first global carbon credits, the VanEck Global Carbon Credits ETF (Synthetic), has listed on the ASX under the ticker code XCO2. Investor Daily

Australia’s first Sharia-compliant ETF has listed on the ASX—the Hejaz Equities Fund (ASX:ISLM) and Hejaz Property Fund (ASX:HJZP) both started trading on the ASX last week. Finder.com

 

Flows

Investors have seen up to 15 years’ worth of gains wiped out in some ETFs amid the chaos enveloping the UK gilt market.

iShares’ £1.1bn Core UK Gilts Ucits ETF (IGLT) is now trading at levels last seen in 2007, having fallen 33% since late last year.

The sell-off has been sharper still for its sister £545mn £ Index-Linked Gilts Ucits ETF (INXG), which has plunged by 49% — including more than 20% since the end of September — wiping out 12 years of gains.

Despite the sharp falls in the prices of some funds, ETFs have largely behaved as planned despite the chaos, however, with no major dislocations. Trading volumes have risen, particularly for some of the iShares products, the largest and most liquid vehicles in the field. Financial Times

Noteworthy

Closing auctions

The European Securities and Market Authority (ESMA) has outlined new plans for how exchanges should act during market outages which includes suggestions on how exchanges can avoid having a detrimental effect on ‘closing auctions’.

Under the proposals, it said trading venues must have “clear arrangements” in place to ensure the market is provided with a closing price for the day.

These include using an alternative venue to run the closing auction or postponing the auction until a later point in the same day.

In terms of communication, ESMA said all trading venues should provide market participants, including the public, with a notice of disruption as soon as possible, as well as updates at a fixed time interval.  ETF Stream

ETF risks?

The IMF has come out with a statement stressing that policymakers need to re-examine risks posed by ETFs during periods of stress even though the vehicles are “less concerning than their open-ended mutual fund counterparts”.

The authors of the IMF’s recently published global financial stability report expressed their deepest concerns about mutual funds with exposure to illiquid bonds, calling on policymakers to ensure that the funds used adequate liquidity management tools.

However, industry figures said the IMF worries were overstated.

MJ Lytle, CEO of Tabula Investment Management, said while it was understandable for the IMF to highlight every known concern, in reality the ETF wrapper had proved itself to be very robust, for example during the market meltdown that accompanied the beginning of the Covid pandemic in March 2020. Financial Times

 

Additional reads

Circa5000 to launch its own ETFs with direct voting rights. ETF Stream

European fund flows demonstrate strong shift to ETFs. Financial Times

Asset servicing bank Caceis has signed a preliminary agreement to acquire Royal Bank of Canada’s investor services business in Europe. ETF Stream

Grayscale Investments LLC said the SEC acted arbitrarily in rebuffing a bid to convert its $12 billion spot Bitcoin trust into an ETF. Bloomberg

The world’s largest custodian bank and the oldest lender in the U.S., Bank of New York Mellon, has added cryptocurrencies to its custody services.  Coindesk

 

From behind the desk with Andrea Murray

 

Thankfully the days of travel restrictions are well behind us and many of us attempted to jam in many sorely missed holiday trips over the summer.

After a colleague recently travelled to Hluhluwe-Imfolozi Park in South Africa, I was curious to take a look at how Europe’s first travel focused ETF has fared so far this year.

Mirroring the same product in the U.S., the Airlines, Hotels and Cruise Lines UCITS ETF (TRYP) launched in June 2021 with white-label provider HanETF and has reached over $25m in AUM since then.

It’s been a tough volatile market for a laundry list of products this year, including many thematics, so we are not entirely shocked that YTD the fund is down over 20%.

It will be an interesting one to watch as people weigh rising costs versus their pent-up desire to take that long-awaited holiday.