Quantcast

August 2016 ETF 20/20: Exchange Traded Fund Monthly Report


Shutterstock photo

Our monthly ‘ETF 20/20’ report briefly summarizes recent Exchange Traded Fund (ETF) trends globally. It uses data from the First Bridge ETF database that includes all global ETPs.

• Global ETP assets surged by 4.5% in July 2016 to end the month at $3.373T, with significant net inflows into equity ETFs.

• The Bank of England cut its key policy rate to 0.25% and announced plans to buy both UK government (£70B) and corporate bonds (£10B). Though a monetary stimulus is expected to lead to a weaker currency, Yen and Euro currency ETPs have strengthened in 2016 despite negative interest rates in their respective regions.

• With low yields in developed markets driven by quantitative easing, net flows into higher yield emerging market bond ETFs have increased in 2016.

• There were over 70 new ETP listings globally (including cross-listings) in July 2016. 16 were in the US including ESG, multi-factor and VIX based ETPs.

• Precious metals mining, Brazilian small cap and Peruvian stocks were among the best performing ETF categories in 2016 year to date.

• Emerging market equities were the best performing of 6 ETFs representing the major asset classes in the trailing 1 month.

About Us

First Bridge provides ETF data and analytics to reputed institutional clients. Our ETF data sets include daily ETF holdings, global ETF product & smart beta classifications, historical distributions and risk metrics. Our clients include asset managers, financial software providers and research firms that use ETF data as a critical input into their systems & workflow. We often provide ‘high touch’ services to our clients in the form of ETF data sets customized to their needs with related support. The First Bridge team combines deep expertise in the Indexing & ETF domain with skills in statistical programming and data visualization.

Global ETPs: Landscape Snapshot

Global ETP assets surged by 4.5% in July 2016 to end the month at $3.373T, with significant net inflows into equity ETFs. For more granular data & analytics on global ETFs: http://bit.ly/1pwa9FU

Key Developments Impacting ETF Investors & Providers

On Aug 4, 2016 the Bank of England cut its key policy rate to 0.25% and announced plans to buy both UK government (£70B) and corporate bonds (£10B). The stimulus package is aimed at minimizing a possible slowdown in the UK following the Brexit ‘leave’ outcome.

Though a monetary stimulus is expected to lead to a weaker currency, this has not been the case with Japan and the Eurozone in 2016. The Yen and Euro have both strengthened against the US Dollar despite negative rates and stimulus programs in their respective regions. The Pound sterling did however weaken significantly after the Brexit vote and again after the stimulus announcement. Central bank policies and the subsequent currency movements will continue to be a very significant factor in influencing returns for ETF investors this year.

With low bond yields in developed markets, investors have been rotating into higher yield bonds in emerging markets. The table below shows the net flows this year relative to last year for the 3 largest emerging market bond ETFs listed in the US.

Net Flows into 3 Largest US listed EM Bond ETFs

July 2016 ETF Launches – US

16 new ETPs were listed in the US in July 2016. The new listings encompassed multiple asset classes and included ESG, multi-factor and VIX based ETPs. A complete list of launches is available in First Bridge’s regularly updated ETF list: http://bit.ly/1W76vN5

July 2016 – Ex-US ETP Notable Launches

Below we summarize the notable new ETP listings outside the US in July 2016. The table below is summarized from First Bridge’s ETF data sets for institutional clients.

Performance of Key Asset Classes & Strategies

Precious metals mining, Brazilian small cap and Peruvian stocks were among the best performing ETF categories in 2016 year to date, although they had correspondingly high volatility (>50% in the case of SILJ). This list does not include leveraged & inverse ETFs, and includes only one ETF from each specific category (e.g. only one gold mining ETF).

Emerging market equities were the best performing of 6 ETFs representing the major asset classes in the trailing 1 month ending August 5, 2016.

More First Bridge ETF Resources

• ETF Book - ‘ETF Investment Strategies’ (McGraw-Hill): http://amzn.to/19DP5ya

• ETF Daily Holdings: http://bit.ly/2315jzP

First Bridge maintains granular data sets for all globally listed ETFs, with key metrics. For more information, email: support@firstbridgedata.com

Important Disclaimers

First Bridge Data LLC does not intend this guide to provide investment advice, and the information provided in this guide is not and should not be considered investment advice. First Bridge Data LLC shall not be liable for any actions or decisions made based on the information provided in this document, and the reader assumes all risk associated with any investment decision made based on information contained in this document. First Bridge Data LLC is not a registered investment advisor or broker, and does not recommend specific securities, funds, or investment strategies, nor does it advocate the purchase or sale of any individual investment vehicle. Discussion or references to specific securities or investment products in this book should not be considered endorsements or offers to buy or sell those products. The past performance of a mutual fund or exchange-traded fund (ETF), security, or investment strategy cannot guarantee its future performance.

First Bridge Data LLC has no obligation to update this document or to correct any errors or omissions that might be contained in this document. First Bridge Data LLC disclaims all warranties of any kind, expressed or implied, and hereby disclaim and negate all other warranties, including—without limitation—implied warranties or conditions of merchantability, fitness for a particular purpose, or non-infringement of intellectual property or other violation of rights. First Bridge Data LLC does not guarantee the completeness, accuracy, or timeliness of any data in this document, including any data sourced through third-party content providers. Neither First Bridge Data LLC nor its employees, third-party content providers, nor any person through whom the First Bridge Data LLC makes this document available, shall be liable for any direct, indirect, incidental, punitive, special, or consequential damages (including, without limitation, attorneys’ fees), whether in an action of contract, negligence, or other tortious action, that result from the use of this book. Neither First Bridge Data LLC nor its content providers shall be liable for any punitive, special, indirect, or consequential damages arising from or relating to the foregoing, whether in contract or tort or otherwise, even if First Bridge Data LLC has been advised of the possibility of such damages.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.



This article appears in: Investing , ETFs



More from Aniket Ullal

Subscribe






Aniket Ullal
Contributor:

Aniket Ullal

ETFs










Research Brokers before you trade

Want to trade FX?