• Andrea Murray

Robotics ETFs See Significant Outflows

Updated: May 21



This week we saw the first launch of an Ethereum ETF in Canada, and a few launches and index changes in the European region. And even though ESG ETFs enjoyed a knock-out first quarter, one area did not – Robotics. Read on for more top ETF highlights from this week.


Fund Launches and Updates


21Shares has expanded its roster of crypto ETPs with the launch of two strategies targeting cardano ADA and stellar XLM. The 21Shares Cardano ADA ETP (AADA) and 21Shares Stellar XLM ETP (AXLM) listed on the SIX Swiss Exchange, as well as the Stuttgart and Dusseldorf multilateral trading facilities (MTFs), on 26 April with total expense ratios of 2.5%. Link


Invesco has launched the Invesco Nasdaq Next Generation 100 UCITS ETF offering targeted exposure to the eligible 101st to the 200th largest securities listed on the Nasdaq stock market. The ETF has an ongoing charge figure of 0.25% per annum and is available to trade in either USD or GBP share classes.


Invesco has also launched a synthetically replicated version of its US$5.5 billion EQQQ Nasdaq 100 UCIT ETF. The Invesco Nasdaq-100 Swap UCITS ETF will hold a basket of high-quality securities to provide most of the return and seek to improve tracking and performance by using swap contracts. Link


Tabula Investment Management has changed the index on its European corporate bond ETF in a move to increase credit exposure and minimise direct interest rate risk. The Tabula European Performance Credit UCITS ETF (TCEP) has been renamed to the Tabula European IG Performance Credit UCITS ETF. TCEP was the fixed income ETF specialist’s first launch in September 2018 and currently has $14m assets under management (AUM). The total expense ratio will remain at 0.50%. Link


In Canada, CI Global Asset Management's CI Galaxy Ethereum ETF (ETHX) is now trading on the Toronto Stock Exchange (TSX) under the tickers ETHX.B and ETHX.U. The ETF is the world’s first ETF to invest directly in ether and its industry-low management fee of 0.40 per cent has been fully waived until 15 June, 2021. Link


In the U.S., AdvisorShares launched two ETFs favouring the reopening trade - the AdvisorShares Hotel ETF BEDZ invests in the travel industry with a focus on hotels, and the AdvisorShares Restaurant ETF EATZ is just what its name suggests. Great tickers, will be interesting to see how these due given timing.


Invesco is launching the world’s first “green building” exchange traded fund, aiming to fill a gap in portfolios in a world increasingly focused on climate change. The Invesco MSCI Green Building ETF (GBLD), due to list on the New York stock exchange will target the buildings sector, estimated by the UN Environment Programme to account for 38 per cent of global carbon emissions. Link

Flows

Robotics-focused exchange traded funds have seen “massive” outflows in recent weeks. The sharp reversal is starkest in Europe, where robotics and automation-themed ETFs saw record outflows of $506m in March alone, cutting assets 8.5 per cent to $5.4bn. The US robotics segment also witnessed “significant” outflows of $363m, pulling sector-wide ETF assets down 6.1 per cent to $8.9bn, according to Global X.


The pattern was repeated in Europe, with the $3.8bn iShares Automation & Robotics Ucits ETF (RBOT) seeing net outflows of $404m and $153m walking out of the door at the $1.3bn L&G Robo Global Robotics and Automation UCITS ETF (ROBO).


Robotics and automation was the only theme to see outflows in Europe in the first three months of the year, in what was a booming quarter for thematic ETFs as a whole, with record net inflows of €5.5bn helping push total assets to an all-time high of €29.4bn. Link


A red-hot housing market is sparking a record-breaking rally in lumber-tracking exchange-traded funds. The $393 million iShares Global Timber & Forestry ETF (ticker WOOD) has nearly doubled in the past year and is now at a record. Meanwhile, the triple-leveraged $475 million Direxion Daily Homebuilders & Supplies Bull 3X Shares fund (ticker NAIL) is the second-best performing U.S. equity fund this year, according to Bloomberg data. Link


Noteworthy


Goldman Sachs is doubling down on its effort to capture some of the buzz and assets chasing emerging technologies and innovative service businesses. The manager plans to launch the Goldman Sachs Future Consumer Equity ETF and Goldman Sachs Future Health Care Equity ETF, according to registration statements filed last week. The consumer ETF intends to buy securities of companies with technology that is associated with social media, ecommerce, fintech, digital workforces and “lifestyle” services. The healthcare strategy fund is expected to invest in a concentrated portfolio of companies associated with innovations in genomics, targeted medicine and digital health. Link


ETF Stream released a piece noting that the next stage of SFDR could prove to be a major stumbling block for asset managers as they now need to prove their Article 8 and 9 products deserve to sit in those categories.


Now asset managers have made their choice between the three categories, they must be able to show how the data supports these assertions, a task that is “fraught with challenges”, according to industry commentators. These ‘level two’ obligations, which are due by 30 June 2023, will require asset managers to report on 18 mandatory principal adverse impacts statements (PAIS) and other voluntary ones in order to provide create a picture of their product’s ESG profile. Link


In case you missed it…

When turtles fly – on Wednesday, a turtle crashed through the windshield of a car on a Florida highway and struck a 71-year-old woman in the head -- but both the woman and the reptile are expected to be OK. The firefighters confirmed that the turtle was alive and apparently free of serious injuries, suffering only scratch marks to its shell and was released into the nearby woods.



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