Record ETP inflows once again
This week once again we saw a lot of news around crypto ETP launches, the Coinbase IPO and record inflows into the Toronto-based Purpose Bitcoin ETF. In global ETP flows, a trillion dollars in new cash has surged into exchange traded funds over the past 12 months and finally in Asia, Vanguard announced plans to delist all of its Hong Kong-listed ETFs.
Fund Launches and Updates
CoinShares has launched a ripple exchange traded product (ETP), its fourth physical crypto ETP this year. The CoinShares Physical XRP (XRPL) will list on the SIX Swiss Exchange with a total expense ratio (TER) of 1.50%. Link
ETC Group launched the ETC Group Physical Litecoin ETC (Ticker: ELTC) on Deutsche Börse’s XETRA platform on Wednesday. The exchange traded cryptocurrency is structured as an asset-backed debt security issued in Germany, and is marketed and distributed by HANetf.
Legal & General Investment Management (LGIM) has launched a suite of three dividend ETFs with quality screens and responsible exclusions. All three are listed on the London Stock Exchange with total expense ratios (TERs) between 0.25% and 0.40%. All three of the strategies aim to replicate the performance of FTSE Russell quality-screened dividend growth indices targeting their respective geographical exposures. Link
SEBA Bank has entered the cryptocurrency exchange-traded product (ETP) space with the launch of four strategies.
The Bitcoin Tracker Certificate USD (SBTCU). Bitcoin Tracker Certificate CHF (SBTCC), Ether Tracker Certificate USD (SETH), and SEBAX Tracker Certificate USD (SEBAX) are listed on the SIX Swiss Exchange as of 9 April. SBTCU and SETH will have total expense ratios (TER) of 0.75% while SBTCC and SEBAX will have TERs of 1.50%. Link
WisdomTree has announced its physically-backed Bitcoin ETP has listed on Germany’s Börse Xetra.
The WisdomTree Bitcoin ETP has a total expense ratio of 0.95% and is already listed on SIX, the Swiss Stock Exchange. The listing of the WisdomTree Bitcoin ETP on Börse Xetra follows approval from the Swedish regulator to distribute this ETP across the European Union. Link
Canada is once again beating the U.S. in a Bitcoin milestone, as the first inverse Bitcoin exchange-traded fund will debut Thursday on the Toronto Stock Exchange.
Horizons ETF is releasing a fund (ticker BITI) that will allow investors to take short positions on Bitcoin futures, according to a statement. Link
Flows
A trillion dollars in new cash has surged into exchange traded funds over the past 12 months in a powerful demonstration of growing confidence in the global economy’s recovery from the coronavirus pandemic.
Global net investor inflows into exchange traded funds and products reached $359.2bn in the first three months of 2021, the busiest quarter on record, according to the data provider ETFGI. That lifted net global ETF inflows since the end of March 2020 to just over $1tn.
Net inflows into US and Canadian equity ETFs reached $143bn in the first quarter of 2021, up from $30.4bn in the same period last year. Global equity ETFs gathered $46.7bn, more than four times the inflows of $10.5bn registered in the first quarter of 2020. Asia-Pacific equity ETF flows almost doubled to $19.3bn from $9.9bn. Link
DWS’s reign as the number two ETF issuer in Europe is set to come to an abrupt end at some point in the next few quarters following Amundi’s planned acquisition of Lyxor, however, this did not stop the German asset manager posting strong ETF inflows in Q1.
According to data from Morningstar, DWS saw €7.2bn inflows into its Xtrackers range in Q1, the second-highest across all ETF issuers in Europe, taking the firm’s overall ETF AUM to €129bn. Link
Total traded volume Trading activity on the Tradeweb European ETF marketplace reached EUR 57.3 billion in March, its second strongest month ever.
The proportion of transactions completed via Tradeweb’s Automated Intelligent Execution tool was 73.2%.
Volume breakdown Fixed income and commodity ETFs saw net selling for the second consecutive month. Activity in equity ETFs increased to 66% of the overall platform flow, with buys surpassing sells by 12 percentage points.
North America Equities products saw more than EUR 13 billion in notional volume, while Emerging Markets Equities was the only shares-based ETF category to be sold during the month. Link
Ark Invest’s Space Exploration and Innovation (ARKX) exchange traded fund has already made its mark — in part by pushing up the price of its sister 3D Printing ETF (PRNT).
ARKX, which has raked in $583m since its March 30 launch in one of the fastest ETF take-offs on record, has emerged as far and away the largest shareholder in PRNT. As of late last week, ARKX owned 5.8 per cent of PRNT, far more than the next 20 shareholders combined, raising concerns among some analysts. PRNT, a passive ETF, is the second-largest holding in ARKX with a 6 per cent weighting.
“[The ETFs] are propping one another up. It’s a little bit cheeky,” said Kenneth Lamont, senior fund analyst for passive strategies at Morningstar. Link
Noteworthy
The first North American Bitcoin ETF already reached $1 billion (C$1.25 billion) in assets, according to a statement from the launcher.
The product from Toronto-based Purpose Investments, ticker BTCC, has seen massive interest as investors clamor for crypto exposure, especially in an exchange-traded fund wrapper.
Although Europe has several crypto funds that effectively work like an ETF, this is the first anywhere to carry the ETF label. Link
BlackRock has appointed Jane Sloan to replace Stephen Cohen as head of iShares for EMEA. In her new role, Sloan will be responsible for leading the next phase of growth for the ETF business in EMEA along with driving UCITS ETF adoption across the globe.
Vanguard has announced that it will move to delist its Hong Kong-listed exchange traded funds within a month, putting an official end to its seven-year-old locally listed ETF business.
The US passive fund giant will apply to the Hong Kong stock exchange to delist all of its six local ETFs with May 10 being the last trading day. The announcement confirms that the US asset manager has made up its mind to cease operations of the ETFs, which it commenced building up in 2013. Link
The cryptocurrency world had a watershed moment on Wednesday with the public listing of Coinbase.
The company’s valuation soared over the $100 billion mark, dwarfing that of the exchange operators providing the venue for its listing, before ultimately slipping back and taking the shine off the rally in Bitcoin itself leading up to the listing.
The question of which crypto name will be next to market is now bubbling up, even if the Coinbase listing attracted the ire of some crypto zealots.
The Investment Association (IA) will enable financial advisers to compare more than 530 ETFs within its sector data.
From 19 April, ETFs from relevant sectors will be included by the IA from eleven issuers: Amundi, BlackRock, Fidelity International, First Trust, Franklin Templeton, HSBC Asset Management, J.P. Morgan Asset Management, Legal & General Investment Management, Lyxor, Vanguard and Xtrackers. Link
