• Andrea Murray

ESG ETPs Enjoy $11.24 billion of Net Inflows



A new report reveals that 62% of Institutional investors expect to invest in digital asset products for the first time within the next year. There is no slowing down of global ETF launches and even one product idea created by a High School student in the U.S. Read on for more ETF highlights from the week.


Fund Launches and Updates


EUROPE 21Shares has listed non-bitcoin and ethereum crypto ETPs on the Deutsche Boerse as the German regulator continues to ease restrictions on digital assets. The six-strong ETP range consists of the 21Shares Cardano ETP (AADA), the 21Shares Polkadot ETP (ADOT), the 21Shares Solana ETP (ASOL), the 21Shares Stellar ETP (AXLM) and the 21Shares Tezos ETP (AXTZ) all with total expense ratios of 2.50%. The launch also includes the 21Shares Crypto Basket Index ETP which offers exposure to bitcoin, polkadot, ethereum, cosmos and cardano. Link

Amundi launched the Amundi Prime Emerging Markets UCITS ETF (PRAM) which is listed on Deutsche Boerse with a total expense ratio of 0.10%, making it the cheapest emerging market ETF in Europe by two basis points. Link


GraniteShares has launched single-stock ETPs on Euronext Paris which will enable investors to take triple leveraged long and short positions on three leading electric vehicle manufacturers -- Tesla, NIO and Volkswagen. Link


Northern Trust has launched two emerging market ETFs focused on climate and carbon-footprint reduction. The FlexShares Emerging Market High Dividend Climate ESG UCITS ETF (QDFE) and the FlexShares Emerging Market Low Volatility Climate ESG UCITS ETF (QVFE) have been listed on the Euronext and Deutsche Boerse with a TER of 0.35% and 0.31%, respectively. Link


Lyxor recently launched the Lyxor MSCI World ESG Leaders Extra (DR) UCITS ETF on Xetra and Börse Frankfurt with ongoing charges of 0.18 per cent. Link

VanEck has had a busy two weeks of product launches. Last week they launched the VanEck Vectors Rare Earths and Strategic Metals UCITS ETF (REGB) which is listed on the LSE with a TER of 0.59% and the VanEck Vectors New China ESG UCITS ETF (CNEW) which is listed on the LSE and Deutsche Boerse with a TER of 0.60%. Link This follows their triple launch on the 21st of crypto exchange-traded notes tracking solana, TRON and polkadot. The VanEck Vectors Polkadot ETN (VDOT), the VanEck Vectors Solana ETN (VSOL) and the VanEck Vectors TRON ETN (VTRX) are listed on Deutsche Boerse with total expense ratios (TER) of 1.5%. Link



THE AMERICAS

In Canada, Evolve Funds Group launched the Evolve Cryptocurrencies ETF (TSX:ETC). The new offering will combine the firm’s two other crypto funds, which are focused on bitcoin and ethereum. Link


Canada’s Mackenzie Investments has launched the Mackenzie Global Sustainable Bond ETF, expanding its comprehensive suite of global ETFs and adding to its sustainable investing products. Link

Loomis, Sayles & Co. is making a rare foray into the ETF world as the $358 billion money manager teams up with State Street Corp. to launch an active fixed-income product. The two heavyweights have joined forces to birth the SPDR Loomis Sayles Opportunistic Bond ETF (ticker OBND). The fund expense ratio is 0.55%. Link


Another mutual fund conversion in the U.S. The Cannabis Growth ETF (BUDX) is now trading on the NYSE Arca, two years after its original debut as the Cannabis Growth Fund (formerly CANIX). Link


ESG ETF launches seem to be consistently in the headlines but one ETF issuer is looking to profit from the not-so-good. Listed Funds Trust is planning to create the B.A.D. ETF, a passive product that will track an index of betting, alcohol and drugs companies, according to a Monday filing. Link


An ETF idea conceived by a High School student, has been filed with the SEC. The Gen Z ETF, a joint venture between adviser Empowered Funds LLC and sub-adviser Alkali Fintech LLC, will track companies that are most relevant to investors born between 1997 and the early 2010s. Link


Additional launches last week:


Source: Link


ASIAPAC

Mirae Asset Global Investments (Hong Kong) has announced that Citi Warrants will launch warrants based on the $1bn AUM (approx.) Global X China Electric Vehicale and Battery ETF. Link


In Japan, Global X released its Japan Leisure & Entertainment ETF on September 28th on the Tokyo Stock Exchange. Link


Flows


One of Vanguard’s ETFs has just taken the crown for the biggest annual inflow, giving the issuer an edge over competitors within the $6.8 trillion U.S. industry. Investors have poured $41.1 billion into the Vanguard S&P 500 ETF (ticker VOO) so far this year, surpassing the 2008 record of $39.5 billion held by State Street’s SPDR S&P 500 ETF Trust (ticker SPY). Link


ESG ETPs listed globally gathered net inflows of $11.24 billion during August, bringing year-to-date net inflows to a record $108.73 billion according to ETFGI. Total assets invested in ESG ETFs and ETPs increased by 6.1 per cent from $308 billion at the end of June 2021 to $327 billion and 69 per cent YTD in 2021.


The Global ESG ETFs and ETPs landscape had 736 products, with 2,085 listings, assets of USD327 billion, from 160 providers listed on 39 exchanges in 31 countries at the end of August. Link

Noteworthy


Nickel Digital Asset Management has published a new survey of institutional investors and wealth managers from the US, UK, France, Germany, and the UAE who collectively don’t currently have exposure to cryptocurrencies and digital assets. The report reveals that 62% expect to invest in these for the first time within the next year.


The main reason given for investing in digital assets for the first time is the long-term capital growth prospects of cryptocurrencies and digital assets – the view cited by 47 per cent of respondents. Link


The SEC “ETF Rule” has hit it’s 2-year anniversary, and the benefits have proven themselves with the barrier of entry particularly for smaller players. The proof is in the number of U.S. ETF launches – 2021 has seen approximately 310 launches and roughly 200 of those new launches are active, and many are from smaller and new issuers. ETF closures in 2021, which stand at 41, are much less compared with roughly 200 at this time last year. (We ended up with a total of 275 at the end of 2020.) Link


The United States Securities and Exchange Commission has extended the deadline of four Bitcoin ETFs on Friday for 45 days, citing the requirement for additional time to decide whether to accept the 19b-4 applications.

The approval of four Bitcoin (BTC) ETFs — Global X Bitcoin Trust, Valkyrie XBTO Bitcoin Futures Fund, WisdomTree Bitcoin Trust and Kryptoin Bitcoin ETF — was rescheduled to Nov. 21, Dec. 8, Dec. 11 and Dec. 24, respectively. Link


Additional interesting reads:


“What happens in China, doesn’t stay in China”. A recent research report by Bank of America shows that up to a quarter of revenues generated by the constituent companies of ETFs focused on US stocks are derived from sales to China. Link


Bitcoin ETFs may be more valuable to financial advisers and their clients than they are to other groups of investors, industry executives said last week. Link


“But to listen to this lot, you would think active fund management was a hive of scum and villainy, filled with bandits just looking to take your arm off." ETF Stream’s Tom Eckett has an interesting piece responding to a recent Citywire “passive zealots” article and addresses the old news of the active-passive debate. We couldn’t agree more. Link


Poor ESG standards hold back funds’ ability to do good, study suggests Link

Direct indexing is just a minor threat to ETFs Link


U.S. tax changes could drive demand for do-it-yourself indexes and Dimensional Fund Advisor’s lineup of SMAs just dropped from a $20 million minimum to $500k making access to their bespoke portfolios much easier. Link


ETF Express U.S. 2021 Awards. Congratulations to all winners Link


Disclosure: This newsletter consists of curated articles which we have read across the globe and while we can't include every ETF related news item, we would like to hear your thoughts on something we may have missed that you feel is important. All information is sourced from 3rd party media outlets, not our own material and should also not be viewed as financial advice.


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