Global Thematic ETPs Cross $394 billion
Fund launches last week continued in the ESG space and a number of ETF issuers slashed fees to keep ahead of their competition. How low can they go?
And globally, thematic ETP assets crossed $394 billion and will likely to see more growth as ETF providers launch more niche thematic products.
Fund Launches and Updates
BNP Paribas Asset Management has expanded its ESG ETF range with the launch of three fixed income strategies.
The BNP Paribas Easy EUR High Yield SRI Fossil Free UCITS ETF (YBNSFFTC), the BNP Paribas Easy JPM ESG EMBI Global Diversified Composite UCITS ETF (JPMGDTC) and the BNP Paribas Easy JPM ESG EMU Government Bond IG 3-5 Year UCITS ETF (BBBTIEA) are listed on Euronext Paris with total expense ratios (TERs) 0f 0.35%, 0.25% and 0.15%, respectively. Link
DWS has cut the fees on its currency-hedged physical gold ETCs, in a move that makes their strategies the cheapest on the European market.
The Xtrackers IE Physical Gold EUR Hedged ETC Securities (XGDE) is listed on the Deutsche Boerse, while the Xtrackers IE Physical Gold GBP Hedged ETC Securities (XGDG) is listed on the London Stock Exchange.
Both have seen their fees cut from 0.43% to 0.33% apiece, which covers their total expense ratios (TERs) and FX hedge fees. Link
UBS Asset Management is expanding with the latest two ESG ETF launches — the UBS ETF MSCI Europe Socially Responsible UCITS ETF (UIW1) and the UBS SPI ESG ETF (SPISI) are listed on Deutsche Boerse and SIX Swiss Exchange, with total expense ratios (TERs) of 0.18% and 0.15%, respectively. Link
Vanguard has kicked-off its ESG ETF push in Europe with the launch of the Vanguard ESG Global All Cap UCITS ETF (V3AA) which is listed on the London Stock Exchange (LSE) with a total expense ratio (TER) of 0.24%. Link
In the U.S., BlackRock revamped its $7.6 billion line-up of style ETFs featuring new benchmarks, different tickers and slashed fees.
They are cutting the expense ratios on nine iShares Morningstar U.S. Equity Style Box ETFs to a range of 0.03% to 0.06%, down from previous charges that varied between 0.25% and 0.30%. BlackRock has been locked in a contest with runner-up Vanguard Group for flows, with the latter winning last year for the first time since 2013. Link
BNY Mellon Investment Management has filled its first active ETF which will be sub-advised by ESG specialists Newton Investment Management.
The initial suite is comprised of three sustainable funds, BNY Mellon Sustainable US Equity ETF, BNY Mellon Sustainable International Equity ETF, BNY Mellon Sustainable Global Emerging Markets ETF. For $62.9 billion Newton, this is its first foray into ETFs. Link
The race is on in the U.S. Anthony Scaramucci’s firm, SkyBridge Capital, and First Trust Advisors have filed with the Securities and Exchange Commission for a bitcoin ETF – one of the latest to join at least four other firms that have made such an application with the SEC. Link
Fidelity subsidiary, FD Funds Management, is backing an ETF called the Wise Origin Bitcoin Trust.
An SEC S-1 filing explains that for buyers of the Wise Origin Bitcoin Trust ETF, it gives investors a cost-effective and convenient way to invest in bitcoin in their traditional brokerage accounts, without purchasing, holding and trading bitcoin directly. Link
Thematic ETFs and ETPs listed globally reached a record USD394 billion at the end of February 2021. There were 662 thematic ETFs and ETPs listed globally, with 1,258 listings, assets of USD394 billion, from 183 providers on listed on 48 exchanges in 40 countries at the end of February 2021. During February, 53 new Thematic ETFs/ETPs were launched.
The top 10 Thematic ETFs/ETPs by net new assets in February 2021 were:
ARK Innovation ETF, Ark Fintech Innovation ETF, Ark Web x.O ETF, ARK Autonomous Technology & Robotics ETF, ARK Genomic Revolution Multi-Sector ETF, Invesco Dynamic Leisure and Entertainment ETF, Global X Cybersecurity ETF, ChinaAMC CSI Science and Technology Innovation Board 50 ETF, FlexShares Morningstar Global Upstream Natural Resources Index Fund, and Amplify Transformation Data Sharing ETF. Link
In digital assets, March was a relatively quiet month for digital asset investment products as volumes dropped by 17.6% to $772mn and average weekly investment inflows slowed by 70.5%. Nonetheless, total AUM continued to rise month on month and now stands at roughly $58.7bn.
Since the end of February 2021, total AUM across all digital asset investment products have increased 8.76% to $58.7bn (as of 22 Mar). Average weekly asset inflows across all major digital asset investment product providers decreased by 70.5% since February to $149.6mn. Link
The iShares clean energy funds are braced for a major index rebalancing after amassing too much money in too few companies.
The iShares global clean energy ETFs have amassed nearly $11bn in assets invested in an S&P index tracking only 30 companies.
To counter this, S&P Dow Jones Indices has already unveiled three sets of proposed changes — one in February and two this month — to broaden the index. Link
The Bank of Japan’s decision to abandon its $55bn annual target for exchange traded fund purchases and to cease buying those tracking the Nikkei 225 or Nikkei 400 raises questions about the future direction of Japan’s ETF market.
The central bank made its widely expected announcement to abandon the target on March 19, adding it would only now buy ETFs tracking the Topix. It became the largest owner of Japanese stocks in early December last year, surpassing Japan’s Government Pension Investment Fund. Link