The Weekly ETF Roundup: w/e November 27, 2020 – VanEck Launches New Bitcoin ETN on Deutsche Boerse
This is a weekly newsletter of what we have seen in the world of ETFs and thought was interesting. If you like what you read, feel free to spread it around.
Fund Launches and Updates
Fidelity has expanded its sustainable research enhanced range with the launch of an emerging market ETF. The Fidelity Sustainable Research Enhanced Emerging Markets Equity UCITS ETF (FEMR) is listed on the London Stock Exchange and Deutsche Boerse with a total expense ratio of 0.50%. Link
BlackRock has unveiled six equity ETFs offering exposure to a variety of European sectors. The six ETFs are listed on the LSE and Deutsche Boerse with total expense ratios of 0.18%: Link
o iShares MSCI Europe Consumer Discretionary Sector UCITS ETF (ESIC)
o iShares MSCI Europe Energy Sector UCITS ETF (ESIE)
o iShares MSCI Europe Financials Sector UCITS ETF (ESIF)
o iShares MSCI Europe Consumer Staples Sector UCITS ETF (ESIS)
o iShares MSCI Europe Health Care Sector UCITS ETF (ESIH)
o iShares MSCI Europe Information Technology Sector UCITS ETF (ESIT)
VanEck has listed the VanEck Vector Bitcoin ETN on Deutsche Börse Xetra, a new product that allows investors to participate directly in the performance of bitcoin, without having to buy the digital currency themselves. Link
New entrant, Changebridge Capital, launched two active management ETFs in the U.S. -- the Changebridge Capital Long/Short Equity ETF (CBLS) and the Changebridge Capital Sustainable Equity ETF (CBSE). Both combine a technical data-driven approach to stock selection with fundamental analysis. Link
U.S.-based NextFins launched INDF, the Nifty India Financials ETF, based on the Nifty Financial Services 25/50 Index, which reflects the performance of Indian banks, financial institutions, housing finance companies, insurance companies and other financial services companies. Link
Per ETF Logic data, last week the top flows in the UK went to the following 5 ETFs:
Top 5 outflows for the same period:
S&P Global is in advanced talks to buy IHS Markit for about $44 billion amid increasing demand for data particularly from the finance industry. An announcement could come as early as today, the person added, declining to be identified because the information isn’t public. Bloomberg Link
Texas-based Dimensional Fund Advisors intends to convert six of its mutual funds, with total assets of $20bn, into actively managed ETFs during 2021. They recently launched their first ever standalone ETFs.
Converting an existing mutual fund into an ETF rather than simply launching a sister vehicle has the advantage of maintaining a track record and immediately having the scale needed to attract large investors. DFA will become the 12th largest ETF manager in the US, ahead of Goldman Sachs, Fidelity and DWS, according to data from TrackInsight. Link
The CFA Institute has been forced to defend its efforts to create a global standard for ESG investing after a number of large asset managers rejected the CFA’s initiative, saying it would add confusion at a time when global policymakers’ responses to ESG are still developing.
Investors are demanding more information about ESG risks in their portfolios given the explosion of interest in sustainable investing. Yet a lack of standards means that managers’ disclosures vary wildly, fuelling greenwashing concerns. FT Link
Goldman Sachs Group Inc. is planning a European stock trading platform to ensure its clients can still buy and sell shares even without a post-Brexit agreement to allow dealing in London. GS applied to French regulators to start a Paris-based trading venue called SIGMA X Europe and intends to open before Jan. 4 subject to regulatory approvals.
Goldman joins rivals including Cboe Europe and London Stock Exchange Group Plc in forming venues in European cities to ward off disruption at the end of the year, when Britain loses automatic rights to host trading in most EU shares for clients inside the bloc. Bloomberg Link
Lion Global Investors and OCBC Securities have partnered to launch Singapore’s first technology-focused exchange traded fund, rolling out a new ETF that tracks the recently launched Hang Seng Tech index.
Combined assets under management for Hong Kong ETFs tracking the Hang Seng Tech index stood at HK$9.33bn (US$1.2bn) on November 19, according to data from the Hong Kong Exchanges and Clearing website. FT Link
Last week S&P Dow Jones Indices announced plans to include Tesla on the S&P 500 benchmark month and will be the biggest on record. Approximately $4.6tn in passive fund assets track the S&P 500 and it is expected that Tesla’s inclusion on the index may create $51bn of demand for shares from these investment vehicles. Trading houses, market makers and fund managers said they were expecting extraordinary volumes on December 18, the last trading day before Tesla formally joins the S&P 500. FT Link
Fund in Focus
There have been plenty of articles about how Tesla’s upcoming inclusion in the S&P 500 will impact a slew of products tied to the index. Mention of heightened stock volatility and recent performance prompted us to look at this weeks’ fund in focus, the Leverage Shares 2x Tesla ETP.
Launched in 2020, the Leverage Shares 2x Tesla ETP tracks the iSTOXX Leveraged 2X TSLA Index, which is designed to provide 2x the daily return of Tesla stock, adjusted to reflect the fees and costs of maintaining a leveraged position in the stock. It invests directly in the underlying Tesla, Inc. stock and uses margin to purchase additional shares of Tesla. Based on their website, the fund has returned 82.53% for the month and has a TER of 0.75%. On the other side, the Leverage Shares -1x Tesla ETP is down 30.65% for the same period. Leverage Shares Product List
Thank you for reading.
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