Following last week’s news that BlackRock had filed for a Spot ETF in the US there has been a scurry of activity from other managers following in their tracks all hoping to join the party on BlackRock’s coat tails.
Semi-Transparent ETFs are dead
This week T.Rowe Price launched a bunch of actively managed ETFs. Nothing unusual about that but in this case, these funds are fully transparent vs their existing funds which were semi-transparent. When was the last time anyone launched a semi-transparent ETF? A long time ago is our guess.
A humble apology to the CBI and an exciting new launch
Exciting news about seeing another entrant to the European ETF market with the launch of Circa 5000, and really cool to see them partner with Tumulo and become the UK’s first ETF range to provide pass-through voting to investors.
Inconsistencies with ETF share class approach in Europe is madness
The Central Bank of Ireland says that any asset managers adding an ETF share class to an Irish-domiciled product must rename an entire product umbrella and include the identifier UCITS ETF.
German ETF Market Overview
Germany is Europe’s largest ETF market with a 29% market share of European ETF market. Approx. $410bn AUM invested in ETFs and it is the fastest growing Retail market in the region.
The “star portfolio manager” syndrome is taking over ETFs
Very interesting to see Blackrock launch an Active Fixed Income ETF for star portfolio manager Rick Rieder.
This was no doubt a response to the run-away success that JP Morgan has had with the JPMorgan Equity Premium Income Active ETF (now at $25.9bn AUM) managed by one of their star portfolio managers, Hamilton Reiner. The active manager battle within ETF is now well and truly on.
New investors to accelerate growth in European ETF market
A new report predicts a wave of ETF adoption from the next generation of European investors. According to the Blackrock’s report, ETF investors are getting younger, as 18–34-year-olds replace 35+ age group as dominant cohort. The number of European ETF investors projected to grow by 32% in the next 12 months. Iberia is expected to grow the most and Germany could deliver 2 million new ETF investors.
What is ETF good practice?
In latest report, IOSCO suggests for ETF issuers to avoid “exclusive arrangements” with APs and market makers, especially if this impacts the arbitrage mechanism. It also stresses the importance of conducting due diligence when onboarding APs and market makers as well as monitoring them on an ongoing basis.
HOW TO ENTER THE EUROPEAN ETF MARKET
Launching an ETF business is a big commitment, one which takes considerable thought and planning.
The 3 obvious market entry strategies are Build, Buy or Partner.
Some things never change
The recent news that the EU Commission has toned down on its calls for an inducement ban in Europe hardly came as a shock to us. There are too many vested parties operating in the market to make such a ban likely, unfortunately, and by that, we mean the traditional asset management space.
