Is AllianceBernstein Set to Enter the U.S. ETF Arena?
U.S. and Canada ETF flows are reported for the first month of the year and a slew of ETFs launched globally.
The trend of large asset managers entering the ETF space continues as AllianceBernstein indicates their plans to launch U.S. based ETFs in the near future.
Fund Launches and Updates
21Shares launched the 21Shares Aave ETP (AAVE), the 21Shares Chainlink ETP (LINK) and the 21Shares Uniswap ETP (AUNI). All three are listed on the BX Swiss with total expense ratios of 2.5%. Link
Global Palladium Fund has launched the Global Palladium Fund Physical Electric Vehicle Metals ETC with a TER of 0.80%. The ETC is listed on the Borsa Italiana with plans to list on the LSE, Deutsche Boerse and Six. Link
Invesco has expanded into Israel with the listing of its first ETFs on the Tel Aviv Stock Exchange (TASE). The initial products include their flagship UCIT ETFs and others which are popular with investors in the region, including the Invesco S&P 500 UCITS ETF and the Invesco MSCI Emerging Markets UCITS ETF. Link
Effective from 4 March, JP Morgan Asset Management will be adding an ESG filter to the following three products: the JPMorgan USD Ultra-Short Income UCITS ETFs (JPST), the JP Morgan EUR Ultra-Short Income UCITS ETF (JEST) and the JPMorgan GBP Ultra-Short Income UCITS ETF (JSET). Link
Northern Trust Asset Management announced the listing of the FlexShares Listed Private Equity UCITS ETF (Ticker: FLPE) on the London Stock Exchange. The ETF will now be listed on the LSE and Euronext Amsterdam, and is available in Austria, Denmark, Finland, Germany, Ireland, Netherlands, Sweden and the United Kingdom. Link
Tabula Investment Management launched the Tabula EUR HY Bond Paris-Aligned Climate UCITS ETF (THEP). Listed on the Deutsche Boerse with a total expense ratio of 0.50%, THEP is classified as Article 9 under SFDR. Link
Valour’s Solana ETP began trading on the Frankfurt Stock Exchange. Link
In Canada, Horizons ETFs announced the upcoming launch of the Horizons Carbon Credits ETF (“CARB”) which will begin trading on Thursday, February 10, 2022, on the Toronto Stock Exchange. Link
State Street has cut fees on 11 sector ETFs by 2 basis points to 10 bps. This is in line with the majority of Vanguard’s 11 sector ETFs which also charge 10 bp but still higher than Fidelity’s sector ETFs which cost 8 bps. Link
The Roundhill Ball Metaverse ETF ticker META has officially been handed off to the old Facebook. The new ticker for the ETF is METV. Would love to know the details on the behind-the-scenes negotiation on that one. Link
Grayscale has finally entered the ETF world with an ETF which tracks the Bloomberg Grayscale Future of Finance Index (ETF symbol: GFOF). Link
Valkyrie’s Bitcoin mining exchange-traded fund is set to list on Nasdaq under the ticker symbol “WGMI” starting February 8. Link
Full list of U.S. launches
In Australia, BetaShares launched the BetaShares Australian Composite Bond ETF (ASX: OZBD) on the ASX, management fee of 0.19%. Link
Flows and Trading Volume
U.S. ETF flow numbers are in and Morningstar data show that ETFs collected $36.3 billion of new money in January, which would have ranked as the lowest monthly total of 2021. Fixed-income ETFs had $5.9 billion of outflows—their first month of outflows since March 2020. Link
The $14 billion PIMCO Enhanced Short Maturity Active ETF (ticker MINT) lured inflows of nearly $900 million in the best week since it started trading in 2009, according to data compiled by Bloomberg. Meantime, roughly $1.6 billion was pulled from the $39 billion Vanguard Short-Term Bond ETF (BSV) — the biggest withdrawal in three years. Link
January was a risk off month for many products and according to data from CryptoCompare, investors pulled an average of $61mn from digital asset vehicles each week in January. This includes ETPs and trusts so perhaps not that impressive on an outflow. Michael Sonnenshein, chief executive of Grayscale Investments and the $25bn Grayscale Bitcoin Trust, said institutional investors sold off digital asset holdings alongside growth stocks, partly in anticipation of interest rate rises from the US Federal Reserve.
“It’s important to note that there’s still significant investor demand for digital asset investment products, but institutions seemingly reacted to the Fed by offloading their positions,” he added. Link
In Canada, ETFs saw inflows of $5 billion last month. Investors favoured equity ETFs with inflows of $4.6bn while fixed income ETFs accounted for $98 million. ETF providers in the North launched 37 new products which is a record for a single month. Unsurprisingly, ESG was the dominating theme with 19 of the 37 in both the equity and fixed income ETF launches. RBC iShares remains the leader by AUM ($96.7bn) followed by BMO ($82.2bn), and Vanguard ($39.7bn). These three providers have a combined market share of more than 68%. Link
We don’t normally include people moves but this is significant as it signals their entrance to the ETF space. AllianceBernstein has hired Noel Archard as global head of ETFs and portfolio solutions. Archard will be tasked with bringing the asset manager into the active ETF space later in 2022. Based on Archard’s quote below combined with their 2021 ETF launch in Australia, they are clearly going global.
‘It’s an honor to have the opportunity to bring such a significant asset manager to a broader range of investors through the launch of AB’s ETF business, both here in the US, and ultimately, around the globe.’ Link
With over $14 trillion in volume traded in the crypto markets in 2021 and no sign of slowing down, exchanges have no plans to miss out on the growing digital asset market opportunity. Europe has been leading the charge for some time now. Germany’s Deutsche Boerse and Switzerland’s SIX exchange offer a litany of regulated crypto investment products from crypto index funds to Bitcoin and Ethereum ETPs, with over 100 crypto underlying investment products now listed on SIX. Link
A new report titled, Linking CEO Remuneration to ESG Targets, shines a light on the growing trend where ETF issuers incorporate ESG targets into executive bonus pay. ETF Stream summarised the findings and found some of the top European ETF issuers – BlackRock, Amundi, DWS, LGIM and Invesco – have substantial ESG remuneration targets. Linking bonus pay or commissions to strategic priorities is not unheard of but as ETF Stream pointed out — not only does it shape the way the industry approaches ESG but also gives an insight into what drives asset managers’ attitudes towards sustainable investing. Link
Additional Interesting reads:
CSDR is here: Should ETF investors prepare for higher costs? Link
Crypto ETFs Rated and reviewed Link
Speaking of crypto ETPs, the SEC has once again postponed its ruling on the Grayscale application and Bitwise as well. The regulator issued a notice on Friday (Feb. 4th) calling for members of the public to submit written comment on both filings. Link
US Mutual Fund conversions to ETFs continue to gain traction Link
ETF Stream and guest writer from Tradeweb on the rise of ETF Trading volumes Link
The 143 ETFs listed in Hong Kong recorded net inflows of $10.3bn last year, double the recorded amount in 2020. Link
While many firms are considering how to include ESG filters in their products, Strategas Asset Management has unveiled an ETF designed to tap into companies’ efforts to increase their profitability by lobbying the US federal government. Link
CSDR is here: Should ETF investors prepare for higher costs? Link